“…Singapore shall forever be a sovereign democratic and independent nation, founded upon the principles of liberty and justice and ever seeking the welfare and happiness of her people in a more just and equal society,” Harry Lee.

Regular readers will know by now that I’m not to fussed about abstract notions (unlike people like Teo Soh Lung and the other ang moh tua kees who join über white horses to pak PAP) about democracy, liberty and justice in S’pore: these are after all juz abstract nouns.

But I care about “welfare and happiness” of S’poreans because S’pore is a wealthy city state that can afford to spend more on S’poreans. It’s the PAP’s failure to spend more of S’poreans’ money on S’poreans that makes me criticise the actions and machinations of the PAP administration, not abstract notions about democracy, liberty and justice. Money talks, BS walks.

They are demonised by govts round the world because of the costs they impose on society.

It is the long-living healthy (non-smoking, non-obese) who ultimately generate the highest lifetime medical costs says a letter writer to the Economist.

Something to chew on

“Counting calories” (August 13th) takes it for granted that obesity costs the National Health Service “billions of pounds each year”. According to a widely cited study from 2008 by Pieter van Baal, a Dutch economist, it is the long-living healthy (non-smoking, non-obese) who ultimately generate the highest lifetime medical costs. Because obese people die younger on average, they require fewer years of medical care and are less likely to fall victim to the expensive morbidities associated with old age. Obesity prevention is important to improving public health and should not be seen purely as a way of saving money.

Here’s an interesting comment from a FT reader commenting on (What else?) Brexit. He’s saying that Brexit (and the Eurozone crisis) should be blamed on cuts to the benefits of what conservatives, the PAP (including Tharman) and the majority of S’poreans (self-included) would call the “undeserving poor”. (They (and me) would be in favour of helping the “deserving poor”.)

The UK is a federation of sorts. On 23 June, it essentially failed. It failed because London had allowed (over a period of ca 30 years) swathes of the country to become impoverished. The transfer union which once existed had been rolled back so much that living standards of the majority of voters had fallen.

London has been rolling back this transfer union because “the elite” has been making the argument that a transfer union makes people lazy. “We must cut benefits (transfers) to encourage people to get on their bikes!” – sounds familiar?

So here’s the problem: … the eurozone will fail if it cannot improve the living standards of its citizens BUT the observation about the dependency transfers induce also holds. The challenge for the eurozone (as much as all our social democracies) is how to square this particular circle?

The Roman emperors got it right. Bread and circuses for the Roman mob, whether deserving or not. Preserving the peace and maintaining power, were more important than rewarding the “deserving” and punishing the “undeserving”. Now that’s an eternal truth.

And here’s another eternal truth: it’s more efficient to help everyone in need whether they deserve it or not http://gladwell.com/million-dollar-murray/.

Trying to differentiate between the “deserving” and ‘undeserving” ends up costing more.

Post said that the man had been sober for several months. But he could relapse at some point and perhaps trash another apartment, and they’d have to figure out what to do with him next. Post had just been on a conference call with some people in New York City who run a similar program, and they talked about whether giving clients so many chances simply encourages them to behave irresponsibly. For some people, it probably does. But what was the alternative? If this young man was put back on the streets, he would cost the system even more money. The current philosophy of welfare holds that government assistance should be temporary and conditional, to avoid creating dependency. But someone who blows .49 on a Breathalyzer and has cirrhosis of the liver at the age of twenty-seven doesn’t respond to incentives and sanctions in the usual way. “The most complicated people to work with are those who have been homeless for so long that going back to the streets just isn’t scary to them,” Post said. “The summer comes along and they say, ‘I don’t need to follow your rules.’ ” Power-law homelessness policy has to do the opposite of normal-distribution social policy. It should create dependency: you want people who have been outside the system to come inside and rebuild their lives under the supervision of those ten caseworkers in the basement of the Y.M.C.A.

That is what is so perplexing about power-law homeless policy. From an economic perspective the approach makes perfect sense. But from a moral perspective it doesn’t seem fair. Thousands of people in the Denver area no doubt live day to day, work two or three jobs, and are eminently deserving of a helping hand—and no one offers them the key to a new apartment. Yet that’s just what the guy screaming obscenities and swigging Dr. Tich gets. When the welfare mom’s time on public assistance runs out, we cut her off. Yet when the homeless man trashes his apartment we give him another. Social benefits are supposed to have some kind of moral justification. We give them to widows and disabled veterans and poor mothers with small children. Giving the homeless guy passed out on the sidewalk an apartment has a different rationale. It’s simply about efficiency.

Funny that the PAP administration’s cost-benefit analysis don’t show this? Not really, because “costs” and “benefits” are in the eye of the beholder i.e. figures can always be fudged. Now that’s another eternal truth.

In an interview last week, said that the government will hold fast to its goal of having a two-thirds Singaporean core in the economy, and this will be the structure of the country’s workforce in the “medium to long term”. BS

NCMP Yee says Lim talking cock over optimistic view of maintaining 1/3 FTs in “medium to long term” For starters, FT workforce already more than 1/3

On his blog [Link] on 21 Aug, JJ pointed out that former Manpower Minister Tan Chuan-Jin had admitted that the one-third FT target is possible only for this decade, during a Parliamentary debate 2 years ago.

“That I agree with.”

“Whilst doing our own computations for alternative models, we had then studied all the publicly available numbers about population in Singapore. There will be net addition to the local workforce from 2013 till 2020, the end of this decade. This is because there will be more Singaporeans turning of age to be included into the workforce than there are Singaporeans retiring.”

He noted that beyond 2020, in order to get the kind of economic growth the PAP government had wanted in the White Paper, there has to be more addition of foreign labour without any addition of local manpower.

“How much to add will depend on productivity growth, which the government had set a target of 2-3%. Sadly, this productivity growth has been near zero or negative in recent years.”

He therefore questioned Lim’s talk of maintaining the 2:1 ratio of Singaporean to foreign workers in Singapore’s workforce in the “medium to long term”.

“So, Mr Lim’s comments that the two-thirds Singaporean core will be something for the ‘medium to long term’ is rather puzzling. What is ‘medium to long term’?”

“His predecessor (Tan Chuan-Jin) had already agreed with me that ‘by 2020 our own domestic labour force growth will basically end up at about zero. So whatever growth we have thereafter will largely be foreign labour growth’ and that ‘it (foreign workforce) is really about one-third for this decade until about 2020.”

Worse, the proportion of local work force seems to be decreasing while that of foreign work force is increasing.

In other words, as of last year, the proportion of foreign workers in our work force was already 38.1%, more than 1/3.

“Is Mr Lim’s definition of long-term up to 2020 only? If it is beyond 2020, how is he going to achieve that because even with a growing local workforce in this current decade, the ratio has been declining well past the two-thirds ratio already while productivity has failed to improve?”

Hear, hear for JJ, This is the kind of questioning I expect when I voted for WP at the last GE.

Back to the interview. Zorro said that the tightening of Singapore’s foreign manpower was not a reaction to past mistakes, but was rather a reflection that realities had changed. The inflow of foreign manpower was a hot topic during the 2011 General Election, and Mr Lim identified the “determination to manage” the growth of the foreign workforce here as the key shift in manpower policy since.

“It’s not so much because the policy of the past was a mistake but rather, we are now having a new stage of growth and therefore we have to pursue a new direction,” he said.

Oh how very convenient that “a new stage of growth” comes at a politically convenient time?

If anyone believes this, they’ll believe anything.

He went on to say, “Every country has to find the right balance … But on the whole, I would say that we have managed the process a lot more effectively compared to some other cities and countries. Through the manpower quota system, we have ensured foreign manpower spread across all sectors and companies.”

Manpower quota system? As TRE pointed out: for foreign PMETs, that is, foreign EP holders, there is no quota imposed in Singapore.

In the US, for example, the congress controlled their H-1B visa (equivalent to Singapore’s EP) for foreigners tightly. The current US law limits to 65,000 the number of foreign nationals who may be issued a H-1B visa each fiscal year. US laws also exempt up to 20,000 foreign nationals holding a master’s or higher degree from US universities from the cap on H-1B visas. In addition, excluded from the ceiling are all H-1B foreign workers who work at universities, non-profit research facilities associated with universities, and government research facilities. Universities can employ an unlimited number of foreign workers as cap-exempt. This also means that contractors working at but not directly employed by the institutions may be exempt from the cap as well. In FY2010, 117,828 H-1B visas were issued by US government. In FY2012, it was 135,991 [Link].

In Singapore, for example, the figures given by the government for the number of EP holders at the end of 2010 and 2011 were 142,000 and 176,000. That means, there is an increase of 34,000 foreign EP holders in Singapore in 2011 [Link]. If we were to add in S-Pass holders, the increase in number of foreign PMETs in 2011 came to 49,000. That’s already almost half of what the whole of US issued in FY2010.

Also, spouses of H-1B visa holder in US are not allowed to work at all. But in Singapore, spouses of EP holders can work through obtaining a Dependant’s Pass [Link].

Coming back to the protection of jobs and wages, it would seem that the PAP and NTUC can safely say that they are protecting FTs jobs and wages here, given the absence of quotas for employment pass holders. What do you think?

SDP’s Dr Paul Tambyah said something recently that deserves to be very widely known. At a recent forum organised by the National University of Singapore Society where representatives from nine opposition parties and the ruling PAP were present, Dr Paul Tambyah said that young local doctors complaining about the hours and working conditions in hospitals, were told that the hospitals could always employ FTs at lower salaries. If our brightest citizens (even straight As can’t get into the local medical schools) are threatened with FT replacements, what about the Vocational Institutes’ grads?

For all their academic brilliance Ah Loong and team have not advanced beyond tinkering with the framework that Dr Goh Keng Swee, Hon Swee Sen and Albert Winsemius devised. Evolution is fine to a point. But surely the world has undergone revolutionary change. When they were constructing their model of serving MNCs as a path to grow the economy, serving MNCs was “neo-colonialism”. Today even Red China serves as as the MNCs’ factory.

And many of our PMEs have not gone beyond thinking like clerks, hence they are easily replicable by cheaper FTs?

My friend (member of a small subset of an ethnic minority) posted this on Facebook:

Baghdadi Jew (David Marshall) was able to be Chief Minister because in the 1950s, majority electorate was non-Chinese. Please check the 1950s census. Fact: many immigrant Chinese did not have voting rights then LKY as an opposition MP fought hard in legislative assembly in 1955/56 to give citizenship and voting rights chinese and Indian immigrants staying here. By 1959 GE, the Chinese had become majority and PAP rode on their support to a landslide victory.

He, a stickler for facts was responding to the often repeated comment that since our first Chief minister and first opposition legislative member was a Ceylonese Tamil, waz this about S;porean Chinese not being prepared to have a non Chinese PM? https://www.facebook.com/photo.php?fbid=10153129351119541&set=gm.382442271965075&type=1&theater

The answer is that the many local Chinese did not have the vote because they were what today Gilbert Goh, and Goh Meng Seng and his fellow cybernuts would call FTs. So much so that majority electorate was non-Chinese.

Our very own Harrry and Pope John Paul II (pope in late 80s) had the same view on one topic

Liberation Theology, the controversial movement based on the conviction that the gospels enjoin the Church to put the poor first, which preoccupied and divided Latin America’s Catholics for much of the 1960s, 70s, and 80s. John Paul believed it had tempted some priests and bishops into quasi-Marxist and even violent ideology, and as Pope he cracked down on some Liberation Theologians.

Would Harry have arrested the present Pope if he were here then working as a priest?

Jorge Bergoglio rejected Marxism – although he cheerfully accepts that he has many Marxist friends – but accepted many of Liberation Theology’s principles, espousing what Austen Ivereigh calls “a nationalist version” of the movement, or a so-called “Theology of the People”.

And he just issued “Laudato Si” encyclical where Francis says that sins against creation are very different from broken financial promises made between people, and everyone is responsible for everyone else because is a moral debt of the rich to the poor: The obligation is universal and implies a preference to those most in need. That is because the poor gain most from generosity and suffer most from hard-heartedness. http://blogs.reuters.com/breakingviews/2015/06/24/edward-hadas-unforgiving-pope-is-right-on-money/

Tell that to Ah Loong who grudgingly spends our money on welfare for ourselves becauses it’s good politics and good for the economy. https://atans1.wordpress.com/2015/06/19/spending-more-on-poor-middle-class-not-juz-cause-ge-coming/

Seriously, I now understand why S’pore has a tradition of Catholics fighting for social justice: people like the above and lawyer Peter Low: social justice is in the DNA of the Catholic church:

the economic writings of both John Paul and Francis also reflect the same intellectual tradition – one known as Catholic Social Teaching. It was originally articulated in an 1891 papal document called Rerum Novarum, in which Pope Leo XIII addressed what he called the “spirit of revolutionary change” then sweeping Europe.

Some of it is very clearly designed to be a rebuttal of the communist ideas that were part of that change, but it is also a critique of aspects of capitalism. So it is an unfamiliar mix that does not fit neatly into the left-right divide that dominated the politics of the following century.

Prof Maurice Glasman, a British economist who used to be a close confidant of Ed Miliband, studied Catholic social teaching for his PhD. He was attracted by the way it rejects the conventional ideologies of both left and right.

It’s not communist or even socialist:

“It really opposes this idea that there is just the state or the market,” he says. “It believes in activating society – what it calls solidarity – so that it can resist the domination by the rich of the poor, but through trade unions and vocational associations and what’s called subsidiarity, which is the decentralisation of power.” Glasman says it is opposed to communism because it “upholds private property” and is “anti-collectivist”.

But some Americans (and I’m sure PAPpists) are not impressed:

Glasman has a vivid memory of being attacked by an American economist after giving a paper at a recent Vatican conference on Catholic social teaching. “You know there’s a word for what you’re saying, Baron Lord Professor or whatever you are,” the challenge began. “Yeah, it’s called Communism. You’re trying to interfere with the prerogatives of management, you’re trying to interfere with capital, and you’re trying to interfere with prices. And that’s been tried – and that’s the Soviet Union.”

But Pope and Cardinal Marx believe in social justice.

During the subsequent discussion Glasman was delighted to find himself supported by both the Pope and the Archbishop of Munich, the appropriately named Cardinal Marx.

So what has all the above to do with Amos, son of mother Mary? Given the involvement of the Church in fighting for social justice, it’s reasonable to conclude that it’s highly likely that Amos is really autistic, sliming the church that is no friend of Harry and Thatcher who he also mocks. Only an autistic would put all three in the same category.

Doubtless post GE, they expect the goodies to stop. And S’poreans will be squeezed again. These will make the cybernuts and TOC happy again, pAP screwing the stupid voters who vote for them.

Well think again. There is a new fashion in economic thinking as this extract shows

[O]n June 15th economists at the IMF released a study assessing the causes and consequences of rising inequality. The authors reckon that while inequality could cause all sorts of problems, governments should be especially concerned about its effects on growth. They estimate that a one percentage point increase in the income share of the top 20% will drag down growth by 0.08 percentage points over five years, while a rise in the income share of the bottom 20% actually boosts growth. But how does inequality affect economic growth rates?

[T]he recent rise in inequality has prompted a new look at its economic costs. Inequality could impair growth if those with low incomes suffer poor health and low productivity as a result, or if, as evidence suggests, the poor struggle to finance investments in education. Inequality could also threaten public confidence in growth-boosting policies like free trade, says Dani Rodrik of the Institute for Advanced Study in Princeton.

More recent work suggests that inequality could lead to economic or financial instability. In a 2010 book Raghuram Rajan, now governor of the Reserve Bank of India, argued that governments often respond to inequality by easing the flow of credit to poorer households. Other recent research suggests American households borrowed heavily prior to the crisis to prop up their consumption. But for this rise in household debt, consumption would have stagnated as a result of poor wage growth. Economic eminences such as Ben Bernanke and Larry Summers argue that inequality may also contribute to the world’s “savings glut”, since the rich are less likely to spend an additional dollar than the poor. As savings pile up, interest rates fall, boosting asset prices, encouraging borrowing and making it more difficult for central banks to manage the economy.

Economists say that some inequality is needed to propel growth. Without the carrot of large financial rewards, risky entrepreneurship and innovation would grind to a halt. In 1975 Arthur Okun, an American economist, argued that societies cannot have both perfect equality and perfect efficiency, but must choose how much of one to sacrifice for the other. While most economists continue to hold that view …

And we know the author, enforcer of Hard Truths has gone to the hall where Mao, Stalin, Lenin, Churchill and Hitler are dining at the high table.

SingFirst is proposing to spend an additional S$6 billion a year – over and above what the government is spending – to tackle what it described as “rising inequality”, funded from the net investment returns (NIR). The NIR allows the government to spend up to 50 per cent of expected long-term real returns on its net assets managed by the Government of Singapore Investment Corporation (GIC), Monetary Authority of Singapore (MAS) and more recently Temasek Holdings.

SingFirst said the money will be spent to provide free education, higher subsidised child care and higher transport subsidies, among other things. The biggest ticket item is an old-age pension of S$300 a month for 600,000 senior citizens. The party also wants to phase out the Goods and Services Taxes (GST) by increasing taxes on higher income individuals.

(CNA)

Doubtless Meng Seng* and friends will be quoting Philip Ang**, their financial expert, on why there is no NER.

Funny that Tan Jee Say wants to abolish GST. It’s regressive but that can be overcome by real cash rebates to the poor and middle class, not the PAP’s pseudo rebate to the CPF accounts. In general, economists like GST because of its simplicity and because it taxes consumption, not investment or savings.

—-

*After last GE, Meng Seng said he would monitor and report on Bishan GRC’s spending plans, ’cause he said the projects they promised were more than Bishan could afford. Err not heard anything from him.

**When analaysing London commercial property (when trying to slime GIC), he leaves out the rental yield, saying yield is irrelevant. Well the reason why the Arab SWFs and big property investors love London is that it offers good rental yields.

The main UK fuel suppliers and distributors have denied pump prices have not been reflecting recent falls in the price of oil but Danny Alexander, the Chief Secretary to the Treasury, is to write to them.

Conventional wisdom is that the next GE will be held after the 50th anniversary celebrations of S’pore’s independence which will be a celebration of all things PAP. So the Oppo parties are not gearing up for an early GE (end of this yr or before Aug 9 next yr.)

And this piece of news doesn’t disturb the narrative:With the January 2017 deadline for the next General Election looming closer, the Elections Department (ELD) has been calling up public servants for training to be election officials, as part of the electoral process … , the ELD said in an emailed statement: “ELD prepares and organises the Public Service to conduct elections in Singapore. Amongst other work, ELD selects and trains public officers on an ongoing basis to perform election duties during an election.” (CNA 17 October)

There have been early training sessions before with no elections following. The conducting of training sessions is a lousy leading indicator.

But think about the economic prospects of S’pore and the training could be a sign of early elections.

No govt wants to hold a general election in a recession or when a a recession is likely. Already the growth rates for this yr and next yr have had to be trimmed because the global economy isn’t doing too well.

And things could get worse: The global economy is in a woeful state [Skip the next few paras if pressed for time or an illiterate in finance and economics]. The euro zone, fully 17% of global GDP, is predicted to expand just 0.8% in 2014 according to the IMF. China and Japan, together 25% of global GDP, are slowing. Emerging markets are floundering: a report on the synchronised slowdown from the Fund puts much of it down to weak trading partners (a sort of trade contagion). As the world slows, America seems a prudent place to park cash. Chinese and Japanese holdings of US Treasury bonds—now $2.5 trillion—have doubled in five years, according to the TIC data.

… the euro area. Inflation is just 0.3% and the area is already awash with unemployed workers … end up with both fiscal and monetary policy being relatively tight.

What would happen next? American exporters would get hit twice—first by weak demand from abroad, then as their goods get pricier for foreigners to buy as the dollar continues to rise. But since America is a relatively closed economy, the impact abroad could be bigger. The big risk is that a runaway dollar topples emerging-market economies just as it did in the 1980s and 1990s. A pessimist would argue that many of the conditions now are exactly as they were then. Many emerging markets borrow by issuing bonds in dollars, rather than their own currency. Appetite for these higher-yielding dollar bonds has been strong in recent years: in January 2014 Indonesia issued its largest dollar bond since 1998; according to its Finance Ministry data, India has dollar debts of around $273 billion (15% of GDP). As the dollar rises, the local-currency cost of these debts goes up.

Floating exchange rates make things a little different when compared to the Asian crisis, but would not help that much. Take a country like Brazil, which has inflation of 6.75% (see the WSJ on this) and yet an economy in recession. If its currency continues to depreciate against the dollar then inflation builds up further. The central bank ends up in a bind: raise rates to cut inflation and stem the depreciation, or keep rates low to get the economy back on track. Both paths would be risky, and could cause a wider stress if the contagion of previous emerging-market crises is any guide.

With any luck none of this will happen. But it all could happen. And if you are in the business of forecasting and stress testing, you should prepare for the worst.

So what about the fact that oil prices are close to US$80 from US$105 a few weeks ago

[M]ajor Asian economies, though, will look at falling oil prices less as a stimulant and more as a signal that global growth is faltering. For export-dependent Asia, lacklustre worldwide demand could end up being highly disinflationary.

That’s a big worry for the likes of China, Hong Kong and Singapore. These economies have all seen private credit rise rapidly since the 2008 crisis and need tolerably healthy inflation to help bring down the real value of debt. But China’s 1.6 percent inflation rate is now the lowest since February 2010, while the annual rate of increase in Singapore’s consumer prices has slipped below 1 percent. South Korea, which has historically had a problem of high household debt, can’t afford to allow its meagre 1.1 percent inflation rate to slide further.

So I wouldn’t be surprised if 50th anniversary celebration events come fast and furious early next yr: to remind S’poreans of the role of the PAP in S’pore’s development from the second largest port in Asia to a global city state, with property prices to match those of global cities like NY and London.

*Btw two countries where I have investments will benefit: The big exceptions are India and Indonesia. Both governments supply gasoline and diesel to their consumers at fixed, affordable rates. For them, the 25 percent slide in the price of a barrel of Brent crude over the past four months translates into significant budgetary savings, which could be channelled into much-needed infrastructure investment.

Could be govt wants S’poreans to get married and then breed earlier? Finish poly or vocational training, get a job, earn money and then get handcuffed and breeding is the master plan?

How did I come to think such tots? I had read an article in BT on S’pore’s latest population report, and a piece in the Economist on how the cost of a college education is forcing young Americans into later and later marriages.

BT on 26 September reported that according to the latest Population report released on Sep 25 by the National Population and Talent Division (NPTD — the same people who came up with the population White Paper that was rubbished by scholars). the statistics show a growing number of singles in this country, and when they do marry, it’s at a much later age.

This is the bit from the Economist: the cost of college can delay the day when young people feel they can afford an engagement ring, let alone a family. A third cited their finances as the reason they were not yet hitched, compared with just 20% of those over 35. As one Eminem fan at a recent music festival in Atlanta romantically put it “I’m just trying to sort things one at a time. I’ve got a girlfriend but I’ve also got college debt.”

With voters annoyed with the govt’s, “We love FTs, even two-timing Raj and Hui Hui”, there seems to be a mnarked slowdown in the FT intake, so The Republic’s population growth has slid to its lowest in a decade, fertility rates have fallen further, and ageing continues at a rapid pace … negative repercussions on the economy …

Latest government figures released by the National Population and Talent Division (NPTD) on Thursday show that the total population grew at its slowest pace in 10 years, expanding just 1.3 per cent to 5.47 million as of June this year.

The easing in total population growth was driven by slower expansion in the non-resident population, which now stands at 1.6 million – an increase of 2.9 per cent compared to 4 per cent a year ago. This was, in turn, a result of the government’s tight restrictions on foreign labour inflows, which saw foreign employment growth slow to 3 per cent versus 5.9 per cent the previous year.

The spin for FTs like Hui Hui. (Ever heard of QC? Though thinking about it, Hui Hui’s a natural life insurance agent, second-hand car salesperson,more of this soon,, sans her looks and voice.)

By granting 20,000 new citizens and 30,000 new permanent residents (PRs) annually in the past few years, the government has kept immigration numbers stable. This is even as the citizen population continues to age, and as Singaporeans have fewer than enough babies to replace themselves. With increasing life expectancy and low fertility rates, there are more citizens in the older age groups today. The proportion of citizens aged 65 years and above rose to 12.4 per cent in 2014 from 11.7 per cent a year ago, while the median age of Singaporeans increased to 40.4 years from 40 years previously. This means the old-age support ratio – which is the number of citizens in the working age band of 20 to 64 needed to support one older citizen – is shrinking rapidly.

It fell from 11.4 in 1980 to 8.4 in 2000, before sinking further to 5.2 in 2014. At the same time, the resident total fertility rate (TFR) fell to 1.19 in 2013 from 1.29 in 2012, which was a “dragon year” on the Chinese zodiac. While NPTD said that the dip from 2012 to 2013 was gentler compared to previous post-dragon years, the overall TFR of 1.19 is far below the replacement level of 2.1.

Taken on their own, the latest population statistics paint a rather grey picture of Singapore’s future. A shrivelling old-age support ratio would mean greater pressure on the working population[Tot govt claims that the great thing about CPF is that it’s not dependent on younger workers unlike ang moh pension systems] and more stress on fiscal policy – worrying trends which population experts have long flagged. (BT 26 September)

— China’s internet, social media censorship practices (thank god we got Yaacob, a Malay, doing it, not the People’s Voice, TKL who wants S’pore to adopt the Chinese practice of all bloggers and posters registering their identities with the govt before they can comment);

— American social conservatives’ values on family (though not on abortion).

The has been adding to global warming (all that hot air, and methane from BS) and a waste of effort, money.

The govt should heed the words of a reader of the Economist (required reading of cabinet, civil service but apparently not Jason Chua and the other morons of that pro-PAP FB page, “Fabrications about the PAP”):

“What politicians and policymakers are looking for is a panacea. Imitating Germany will not work. There have been many attempts to imitate Silicon Valley, but no one has succeeded. It is impossible to copy the culture, thinking and collective experience found in a company or a country.”—on “German lessons”, July 12th 2014.

Singapore has to strengthen its track record of trust, knowledge, connectivity, and livability to attract global companies to set up shop in the country, but must also position itself where it can add most value, said Deputy Prime Minister Teo Chee Hean.

“To achieve sustainable growth, Singapore cannot simply continue to do more of the same, or to put in more resources in a linear fashion,” said Mr Teo, who was speaking at an annual scholarship award ceremony for the Economic Development Board (EDB) on Monday (July 21). (CNA)

The govt should remember that the world class port and the airport and the financial centre were developed without aping any other place. As was SIA, and Keppel Corp’s rig-building businesses. The starting point was the expertise already here, expertise that juz needed nurturing. And Dr Goh aped no-one when he developed Jurong and let the MBCs in.

Growing the economy doesn’t mean more FTs, nor more start-ups, nor more financing of SMEs (owners use money to buy property, flashy cars and donate to WP LOL), but an innovation ecosytem.

This comment by someone analysing the stagnation in the West applies here too

What we need if we are to avoid the much-feared “secular stagnation” is not many small startups—or an obsession with financing “SMEs”–but an innovation ecosystem in which these new firms are made relevant through a dynamic interaction of public and private investments. This requires a public sector able and willing to spend large sums on education, research and those emerging areas that the private sector keeps out of (because of high capital intensity and high technological/market risk); large firms which reinvest their profits not in share-buybacks but in human capital and R&D; a financial system that lends to the real economy and not mainly to itself; tax policy that rewards long run investments over short run capital gains; immigration policy that attracts the best and the brightest from around the world; and rigorous competition policy that challenges lazy incumbents rather than letting them get away with high prices and parasitic subsidies.

Given the importance the PAP places on growth (a growing economy translates into voters: a Hard Truth that went wrong when the PAP forgot that growth must benefit voters), one can only hope it focus on creating an innovative ecosystem, rather than talk about it, as it has done for yrs on end.

In the course of helping the author of Dissident Voices in the research for the sequel, I borrowed the WP 50th Anniversary Commemorative Book from the National Library, Marine Parade branch. I couldn’t find it on the shelves so I asked the librarian if it was “protected” by an invisibility field or was only available to the “right” people. No, it wasn’t hidden away under lock and key. It was openly displayed on the shelf near the PAP’s 50th anniversary book. But it is such an inconspicuous volume that I missed it.

The book told me things that the ST never reported about the 1984 and 1991 general elections. Remember that these events happened before the internet age. If the media didn’t report something, it didn’t exist for practical reasons (Somewhere I blogged on how the 1988 results for Eunos GRC came as a surprise: WP nearly won).

I learnt that the 1984 election manifesto was entitled”Wake Up to Your Freedom , It’s Time”. calling for the people to vote for “the Hammer for a caring society”. The WP called for

— Free and adequate medical care for the needy

— Commission to review education policy

–Free schooling and equal opportunities in education for children from poor families

— Workers’ rights

— Reduced CPF contributions and the right to take your CPF savings at 55

— Adequate care for the aged

— Greater share forSsingaporeans in the economic wealth

— Help for the disabled

— Abolition of tax subsidies and privileges for the rich

— Reasonable compensation for acquired properties

— Abolition of tax on water, light and telephone services

— Review of all fees paid to government and statutory boards

— Guaranteed personal for every citizen

— Freedom from exercise of arbitrary power and protection of citizen’s rights

All this in response to the younger PAP’s ministers call to vote for the PAP for a Swiss std of living.

I find the 1984 manifesto more stirring and, more importantly, rationally relevant today. True the ideas in the manifesto sounded like pie-in-the-sky in 1984 (when I voted for the WP because I believed that a one-party state was bad for S’pore even though I was happy with most of what LKY, Dr Goh and the other Water Margin “bandits” were doing for us: ya I that ungrateful), but the ideas are no longer rubbish.

According to the PAP we now have a Swiss standard of living (huh? OK, like us the Swiss are unhappy about immigration, so unhappy that in a recent referendum they told the govt to restrict immigration)), and it’s a fact that we got oddles of money in the reserves (though you wouldn’t think so reading Chris Balding and his mindless “hate S’pore” groupies) thanks partly to Dr Goh’s ideas: doesn’t this mean we can now afford the things WP was calling for in 1984?

As regards the danger of overspending, we got the capital, and part of the income from it locked away from the govt in power, whether it be PAP or not. So the govt can only spend what it raises in taxes and the like, what with borrowing requiring the president’s approval.

So the ground is fertile for trying shumething new without worrying that the new policies cannot be reversed.

Another interesting fact I learnt is that according to the book in the 1991 GE, speeches centred mainly on bread-and-better issues:

— The PAP would give beautiful promises before elections but there would always be strings attached — service charges would see a hike soon after.

— Under PAP’s reign, it would be difficult to maintain a family and provide decent education for the next generation.

— Their policies have promoted social inequality and a widening of the rich-poor divide.

— Job security for the workers was pathetically limited.

Sounds familiar? Back to the future?

So, all in all, JBJ and his merry men of bicyle thieves*, ex-Woodbridge patients* , opportunists and economic illiterates were prescient. More prescient than me at least (trained lawyer and wannabe corporate financier). They were prescient earlier than Dr Chee who was still in shorts in 1984. Remember he had been banging away since the 1990s about growing inequality etc as the SDP rightly never fails to remind us. Well JBJ and his merry men had been doing so earlier.

With this track record, why doesn’t WP remind us that it called the future right in 1984 and 1991?

One reason could be that Low is a modest man, not prone in triumphalism; he was Organising Secretary in 1988. Another reason could be that the WP thinks that in the real world the public has a bad impression of the WP in those years even though JBJ is fondly remembered in cyberspace. History began only in 2001, after Low took power from JBJ.

It’s a fact (not a Hard Truth or a Heart Truth) that after the 1997 GE, the WP went AWOL (or is it MIA?).

It went so AWOL or MIA that it could only field two candidates in 2001. It had wanted to field a GRC team too but one James Gomez** it is alleged screwed up, even though publicly Low took responsibility for the balls-up. In 1988, in the first GE under the uber gerrymandering GRC system, it fielded 32 candidates of uneven quality and contested 6 GRCs and 14 SMCs. In 1991 it fielded 13 candidates in 2 GCs and 5 SMCs. in 1996 it fielded 14 candidates in 3 GRCs and one SMC (Houygang). The candidates in 1991 and 1997 were the kind of people voters were comfortable with.

True the leadership had a major distraction that started when JBJ as the editor of the Hammer, even though he didn’t understand written Tamil, published a letter written in Tamil. Let these extracts tell the story.

Legal Action: An Tamil Article Published on THE HAMMER

In November 1995, the Party and the whole of its Central Executive Council found itself the object of two defamation suits filed by five PAP Tamil MPs and eleven members of the Organising Committee of the Tamil Language Week arising from an article published in the Party organ, “The Hammer”. The Plaintiffs’ complaint in both suits was that the article implied that their efforts to promote the Tamil Language had been less than sincere.Members of the Central Executive Council under suit by PAP Tamil MPs and the Organising Committee of the Tamil Language Week were:-

Chairman

Dr Tan Bin Seng

Vice-Chairman

A. Rahim Rahman

Secretary-General

J. B. Jeyaretnam

Assistant Secretary-General

Low Thia Khiang

Treasurer

Sim Say Chuan

Organising Secretary

Ng Ah Chwee

Committee Member

Lim Ee Peng

Committee Member

James Teo Kian Chye

Committee Member

James Tan Joo Leng

Committee Member

K. Mariappane

Committee Member

Chan Keng Sieng

Eventually, in September 1997, the Party and its Central Executive Council members agreed to pay the five PAP Tamil MPs by 6 instalments, damages for defamation of $200,000/- (inclusive of legal costs). The suit by the eleven members of the Organizing Committee was in the course of hearing at time of writing.

…

Judgment: A Tamil Article Published in THE HAMMER

By the said Judgment given at the High Court on the 30th November 1998 that Jeyaretnam, A Balakrishnan and the workers’ party were collectively and severally ordered to pay ten of the plaintiffs in the said suit a total sum of $265, 000/- for damages and costs to be taxed.The Worker’s Party’s appeal against the said judgment was dismissed on 21 April 1999. By then the total sum had snowballed to close to half a million dollars, inclusive of legal costs.

Whatever the reason for not invoking the past in the past since 2001, the WP should seriously rethink the strategy of trying to be near-clones of the MIW. It was the right strategy in the noughties, and it culminated in the victories in 2011 (it campaigned as the voters’ co-driver to the PAP), 2012 and 2013. Huat ah.

But is it the right strategy for the next GE? For the reasons given above, I think not. It’s like the by-election strategy that was adopted by accident in 1991 (JBJ didn’t want it but he couldn’t get enough WP candidates); gd idea for its time but by the end of the decade had outlived its usefulness.

As someone who wants for starters, an opposition that deprives the PAP of a two-thirds parliamentary majority, I don’t want the next GE to be a rerun of the 1997 one.

—

*OK, OK . Only one of each. But there were many “strange” MP candidates, pre 1988. But thinking about it only those who perceived reality differently from other S’poreans would have dared take on the PAP in the 70s and 80s. Remember LKY was no wimp like Goh or Pinkie; he was the leader of Water Margin “bandits”.

**Yup the same Gabra Gomez of 2006. His instructors in BMT would sure have been real nervous during range, and grenade throwing. In 2011, SDP made sure he kept away from the form filling.

he PAP may have reason to agree. The PAP has had three unflattering rankings. First off was the one early this yr from the people behind the Corruption Index.

Remember Ng Eng Hen getting upset with Transparency International (TI) for giving Singapore a “poor” rating last year for the way it spends money buying weapons. He said that TI’s assumptions for its assessment were flawed. He questioned its move to group Singapore in the same category as Iraq and Afghanistan. TRE rightly pointed out that given if the government finds TI not to be credible as Dr Ng has alleged in Parliament, perhaps the government should stop using TI’s rankings and surveys altogether.

For a start perhaps, CPIB could stop using TI’s rankings on its website. Presently, it prominently displays TI’s CPI on its home page.

Smart people TeamTRE. TRE readers should note that the public face of TRE is a scholar and elite schoolboy. And they hate elites even though one of elites is on TeamTRE. Kinda irrational?

This was followed by EIU naming S’pore as the most expensive city in the world. Tharman rubbished this: My take on Tharman’s take.

BT, part of the constructive, nation-building SPH came out with a piece rubbishing the basis of the index Index and saying that it was not applicable to locals. Extract from BT is at end of article. Kinda long and boring.

So far, there has been conspicuous silence from the govt and its media running dogs (apologies to the dogs) allies, even though the new media is flogging the story with glee, together with the takeover of Olam: anything to do in the PAP?

Could it be that the PAP has realised that silence is golden when it comes to responding to unflattering rankings. Perhaps it has realised the self-defeating nature of rubbishing the unflattering ranking. It gives more publicity to the ranking, shows how hurt it feels and its rubbishing leaves PAP supporters wondering if the assumptions or basis of flattering rankings too are rubbish especially if the rankings come from the same organisation like in case of TI’s rankings.

As someone who hates triumphalism of any sort (the fates get tempted), I hope that the PAP’s silence extends to flattering ratings too. Pigs likely to fly first.

—

SINGAPORE may have climbed five spots to claim the “unenviable title” of the world’s most expensive city, according to a bi-annual ranking compiled by the Economist Intelligence Unit (EIU), but economists downplay the significance of the results.

While acknowledging the undeniable existence of rising price pressures here, economists The Business Times spoke to cautioned against extrapolating that the cost of living for locals has skyrocketed.

This is because two key factors – currency fluctuations and the survey’s expatriate focus – would “automatically limit” such deductions.

In order to achieve comparative indices, EIU’s Worldwide Cost of Living survey converts each country’s prices into US dollars. Therefore, a weaker yen pushed Tokyo – last year’s most expensive city – down to sixth place, and this paved the way for Singapore to claim the dubious honour this time around.

Therefore, Singapore’s ascent to costliest city was due in part to currency fluctuations – EIU noted that over the last decade, Singapore has seen 40 per cent currency appreciation.

Said UOB economist Francis Tan: “There’s so much (buzz) about Singapore taking the top spot, but a lot of this has been fuelled by the fluctuations in different currencies. I wouldn’t read too much into it, because next year we could be number 6 again.”

Mizuho Bank economist Vishnu Varathan added: “If one were to look at cost of living from the point of view of a domestic person, then currency movements arguably don’t matter as much.”

CIMB economist Song Seng Wun was also keen to highlight the survey’s expatriate focus and its purpose as a tool for determining foreigners’ salaries.

In its description of the survey, EIU said: “The survey itself is a purpose-built Internet tool designed to help human resources and finance managers calculate cost-of-living allowances and build compensation packages for expatriates and business travellers.”

Still, emphasising that the basket of goods is “fairly broad to address a lot of essentials”, Jon Copestake, editor of the report, told BT: “The survey is also comparative between locations so it could be argued that if a city is most expensive for expats, then why not for everyone?”

But Mizuho’s Mr Varathan pointed out that “the survey has got inherent biases”: “As they’re looking to compare (like-for-like) items, they probably missed out on some local stuff, and that’s going to work against us. For example, if we take the price of a cappuccino, it will likely set you back about $5. But that’s not the same as getting Ah Poh’s coffee at Golden Shoe.”

Limitations aside, all three economists agreed that the survey results are worth reflecting upon, especially since currency fluctuations only tell part of the story.

Noting that Singapore’s rising price prominence has been “steady rather than spectacular”, EIU said that the city-state was the 18th most expensive city 10 years ago.

It said that Singapore has some structurally expensive items that “skew the overall cost of living upwards”, including cars. This has meant that transport costs in Singapore are almost three times higher than in New York.

Added EIU: “In addition, as a city-state with very few natural resources to speak of, Singapore is reliant on other countries for energy and water supplies, making it the third most expensive destination for utility costs.”

Although the survey’s findings could suggest that Singapore may be losing its cost competitiveness, UOB’s Mr Tan thinks otherwise: “There’s a reason why Singapore is expensive, and there’s a price to pay for everything. If (multinational corporations) want to be in a country where you push a button and things work, where there is near-zero political risk, where the business environment is vibrant – they’ve got to pay a premium for that.” 5March BT

I came across this in the latest copy of the Economist in the letters section:

Petty’s cash ledger

SIR – You credited William Petty with inventing economics in the 17th century, but did not do full justice to his cost-benefit calculations (Free exchange, December 21st). The good doctor estimated the value of a person to be somewhere between £60-90 and in “Political Arithmetick” he suggested these values could be used “to compute the loss we have sustained” from the plague and war. In 1667 he argued that given the value of an individual and the cost of transporting people away from the plague in London and caring for them, every pound spent would yield a return of £84 as the probability of survival increased. (He also suggested that an individual in England was worth £90, and in Ireland £70.)

In a lecture on anatomy in 1676 Petty argued that the state should intervene to assure better medicine, which could save 200,000 subjects a year and thus represented a sensible state expenditure. Today’s economic estimates are more refined and the data are more exact, but the arguments presented by Petty still resonate in public policy.

Rashi FeinProfessor emeritus of the economics of medicineHarvard Medical School

This set me thinking that since the govt is forever touting the importance of costing out the benefits of any spending proposal (something I agree with), maybe it should tell us how much it values a S’porean in monetary terms? Esp since the PM has just said that that more social spending does not mean better results http://www.tremeritus.com/2014/01/11/like-a-war-zone/

As pigs are likely to fly first maybe the SDP RI brains trust (Paul A, Wee Nam, Ang -Drs three- etc) can “force” the govt to do so by coming up with their own SDP valuation, and what they calculate is the PAP valuation.

(There is some analysis of what one LKY said tagged on at the end but yes it’s analysis about M’sia week (previous) ).

Going by this extract from BT, seems that Dr M has forgotten that there was almost no money left in the Treasury when he stepped down.

FORMER Malaysian prime minister Mahathir Mohamad said yesterday that Putrajaya should cut its own costs before burdening the public with higher taxes and tariffs.

It was his first public comment on what has fast become a contentious issue among Malaysians: an increasing cost of living that is set to escalate in 2014.

After the general election (GE) in May, Malaysia was put on notice by the international rating agencies that it had to get its fiscal discipline right. Prime Minister Najib Razak responded by first cutting fuel subsidies and raising petrol prices by 10 per cent in September.

In his October Budget, Mr Najib abolished sugar subsides and pledged to cut total subsidies by 17 per cent in the financial year. The Budget did not achieve that, so most commentators expect more fuel subsidy cuts possibly in the second half of the year. Mr Najib also promised a 6 per cent goods and services tax (GST) by next April.

Yes, yes, I know Badawi accused him of over-spending. But the fact that Badawi and now Najib are having to cut back govt spending shows that Dr M overspent when he was in power. Sadly this never happened here. If only GCT had spent more, LHL, would not be in so much shit. But don’t pity PM: he was DPM then, and in charge of economical and financial matters.

Coming back to Dr M. We can’t be too hard on him given that one LKY said that S’pore was a “barren rock” before the PAP took power. He must have got HK in mind when the British seized HK from the Chinese. I’ll let a HK official tell the story, It was on this day, January 20 in 1841 that a treaty was signed ceding Hong Kong to the United Kingdom.

To cut a long story short, Captain Charles Elliot of the British Royal Navy had negotiated the terms of the agreement and reported them to Lord Palmerston who was then the Foreign Secretary in London.

Lord Palmerston was outraged that Britain had got such a raw end of the deal. He promptly dismissed Captain Elliot from his post and famously declared that Hong Kong was, and I quote: “A barren rock with nary a house upon it. It will never be a mart for trade.”

S’pore as all TRE readers will be able to tell you was the second most important port in Asia, though they may not tell you (because they may not know) that it had problems, problems outlined below*.

LKY would have been on safer ground if he had told S’poreans what might have happened if S’pore had gotten bad govt (like in Burma). But then S’poreans could rightly have asked if there were credible alternatives. The answer to that is not so obvious and detracts from the narrative that the PAP made S’pore. It didn’t: S’poreans of my parents’ generation made modernS’pore on the colonial foundation. The PAP helped in the making.

“Singapore Correspondent” covers five years of Singapore’s colourful political past – a period of living turbulently and sometimes dangerously. It is a collection of eye-witness dispatches, sent from Singapore to London, spanning a time when Singapore was emerging from British colonial rule and moving forward to self-government and independence. Many of the early struggles of the People’s Action Party (PAP) are described as the focus is on the political struggle taking place in which the PAP played a major part. Many important events which have long been forgotten are brought to life. These dispatches prove that political history need not be dull, and indeed can sometimes be entertaining and lively.

Santa’s critics note that higher profits and productivity have not resulted in higher pay for the elves. They were seeing their real incomes squeezed even before the Fairy Tale of Wall Street had an unhappy ending in 2008, and then took pay cuts rather than lose their jobs. With welfare being cut, most plumped for a job over the dole even if it meant a cut in living standards.

Santa accepts that the workforce has made sacrifices. But he insists these are vital to keep the company going at a time of cut-throat global competition. The elves have to understand, he adds, that the alternative to zero-hour contracts and pay cuts would be that the jobs would be outsourced from Lapland to a lower-cost grotto in the far east.

Doesn’t Santa sound like PM or his dad or VivianB or “cheaper, faster” Zorro etc? I’m so confident that readers will agree that I wouldn’t give examples. This isn’t ST.

As to Scrooge, this is how Dickens described Scrooge before Scrooge repented and became a Dr Chee type of person (actually better than Mad Dog as Scrooge had his personal wealth to spend on the poor, Dr Chee is depending on our reserves and higher taxes)

“Oh! but he was a tight-fisted hand at the grindstone, Scrooge! a squeezing, wrenching, grasping, scraping, clutching, covetous old sinner! Hard and sharp as flint, from which no steel had ever struck out generous fire; secret, and self-contained, and solitary as an oyster. The cold within him froze his old features, nipped his pointed nose, shriveled his cheek, stiffened his gait; made his eyes red, his thin lips blue; and spoke out shrewdly in his grating voice. A frosty rime was on his head, and on his eyebrows, and his wiry chin. He carried his own low temperature always about with him; he iced his office in the dog-days and didn’t thaw it one degree at Christmas.”

“Even the blindmen’s dogs appeared to know him; and when they saw him coming on, would tug their owners into doorways and up courts; and then would wag their tails as though they said, ‘No eye at all is better than an evil eye, dark master!”

Mean of Dickens? Scrooge when asked for donations for the poor, “There are many things which I might have derived good, by which I have not profited” and “Are there no prisons?”. Sounds very much like our very own VivianB when he was welfare minister?

The PAP govt is forever warning that if it loses power, or even loses one more parly seat, chaos will ensure.

Happily 40% of voters no longer believe this self-serving nonsense (hence LKY had to warn Aljunied voters that they would repent; and sneerer of the elderly poor, ACS boy is highlighting every molehill of the WP Aljunied town council), though I must point out that .70% of voters voted for two prominent ex PAPpies in the presidential election. The ex-PAP man who denounced PAP lost his deposit. Dr Chee’s man only got 25%: credible but only ’cause there were two credible ex-PAPpies challenging one another.

So all the more surprising that our constructive, nation-building media hasn’t been highlighting the dire economic situation in Thailand which can be reasonably blamed on Thailand’s more democratic system. Now that BN has closed down, time to bring back Bertha Henson to ST and make her editor? Yaacob’s sis (and Cherian George’s Mrs) isn’t doing the “right” things by the PAPpies, Spock – another bald, pointy ears: SPH’s Managing Editor elder brother?– could conclude.

So far as investors and businessmen crave certainty and predictability, the only thing certain in Thailand these days is unpredictability. The prime minister, Yingluck Shinawatra, Mr Thaksin’s sister, now seems to have only the shakiest grasp on power. It’s a fair bet the election she has called for February 2014 will never even happen. She has assembled forums to discuss vague concepts of “reform”, to appease Mr Suthep. At the same time Mr Suthep pushes for a completely new government to be run by an unelected “people’s council”. That is also known as a coup.

For Thai businessmen, this is coming at the worst possible time: the beginning of the tourist season. Tourism is vital to the national economy. Last year the country pulled in about 22m visitors. Overall, the tourism-and-travel sector contributed about $28 billion to Thailand’s economy, which would make it worth 7.3% of GDP for 2012, according to the World Travel and Tourism Council (WTTC). Including tourism-and-travel’s indirect impact on the economy would make the sector’s value rise to $64.3 billion, or 16.7% of GDP. The sector employs about 2m people directly, and far more indirectly.

There are already signs that the ongoing street protests and occasional political violence and thuggery are putting plenty of people off coming to the country—hardly surprising, as dozens of foreign governments have issued warnings against travelling to Thailand. The political situation is estimated to have reduced the number of inbound tourists in the month to mid-December by 300,000 people, or 8% of the number expected, says Yutthachai Soonthronrattanavate, president of the Association of Domestic Travel.

That is worrying, as is the thought that the current turmoil could drag on to the election in February, or even longer if that proves inconclusive—in other words, throughout the high season. Mindful of the value of the tourism industry, Mr Suthep’s mobs have promised not to occupy and close down Bangkok’s international airport, as their predecessors, the “yellow shirts”, did in 2008. That is now well understood to have hurt the tourist industry, and the wider economy.

That will not be enough to offset the difference however, as even more tourists are now attuned to Thailand’s problems and willing go elsewhere on their merry ways. Bangkok also makes a bundle as a destination for conferences and conventions, but now organisers are actively considering going to other South-East Asian venues rather than endure the road closures and traffic chaos that accompany endless rounds of street demos (to say nothing of the threat of violence).

The government’s own grandiose spending plans have been thrown up in the air too.A key part of the government’s economic strategy had been to boost domestic demand by Keynesian-style spending, the political failure to have a functioning government has effectively undermined that whole strategy. Plans to borrow as much as $68 billion for new railways and roads are to be put on the back-burner as parliamentary and constitutional approval for these bills is delayed indefinitely. Many businesses, such as construction companies, stood to benefit from those expenditures, and now their plans have been derailed as badly as any holidaymaker’s. Thailand’s growth rate for 2013 is likely to weigh in at 3% or so, relatively modest for the region. The government’s hope to achieve a rate of 7% for 2014 now looks wildly optimistic.

The govt and the constructive, nation-building media keep shouting at us that a rapidly aging population (and the stas do show this aging as a fact, no bull here) will lead to disaster if FTs like two-timing new citizen Raj or Tammy’s killer or the FTs that beat up S’poreans and then fled S’pore*, or a looney, violent bank director are not allowed in by the container load. They point to Japan as what can happen if FTs are not allowed in: economic stagnation. The truth is more complex. As I reported here HSBC, a bank, in 2012 published research that Japan is doing pretty well when compared to other developed countries, including immigrant friendly countries like the US and the UK (though the UK is now repenting its liberal immigration policy)

Whatever the impact of an ageing population on S’pore’s prosperity, here’s a piece of evidence casting doubt on the assumptions (stated or unstated) behind the need to have a population of 6.9m by 2030. It comes from academics from the University of Edinburgh.

The idea that dependent older people represent a great demographic challenge of our age has been turned on its head …The research questions an assumption behind arguments for health, social care and immigration policies … The paper demands society rethink some of its assumptions about elderly dependency – drawing a distinction between the ‘young old’ and the ‘old old’…

Here’s more from the BBC’s Home (i.e. domestic affairs) editor (Note that the paper in question is based on British statistics but the argument seems applicable elsewhere as he points out)

“The extent, speed and effect of population ageing have all been exaggerated and we should not assume that it will strain health and social care systems,” Professor John MacInnes and senior research fellow Jeroen Spijker write in the article ‘Population Ageing: The timebomb that isn’t?’

Healthier and fitter

The mistake people have been making, the paper suggests, is to assume that all pensioners are dependent and all working-age adults are workers.

They point out that, while it is true there are now more people over 65 in the UK than children under 15, rising life expectancy means older people are effectively “younger”, healthier and fitter than previous generations.

Instead of simply looking at how old someone is, the research focuses on how long they might be expected to live.

“Many behaviours and attitudes (including those related to health) are more strongly linked to remaining life expectancy than to age,” it says.

In 1841, life expectancy at birth was 40 years for males and 42 years for females.

By 1900 it was 52 and 57 and today it is 79 and 83. So the point at which we enter ‘old age’ has also been changing.

Equally, using age to define the adult working populations makes little sense, the authors suggest, because “there are more dependents of working age (9.5 million) than there are older people who do not work”.

So they calculated an alternative measure, what they call “the real elderly dependency ratio”, based on the sum of men and women with a remaining life expectancy of up to 15 years divided by the number of people in employment, irrespective of age.

Important implications

Using this measure, the paper calculates that old-age dependency in the UK fell by one third over the past four decades – and is likely to stabilise close to its current level.

The measure suggests similar falls in many other countries.

“Our calculations show that – over the past four decades – the population far from ageing, has in fact been getting younger, with increasing numbers of people in work for every older person or child,” the authors say.

“The different story of population ageing told by our real elderly dependency ratio has several important implications for health policy and clinical practice.”

In policy terms, this analysis to one of the central challenges of an ageing population might be something of a game changer. Rather than seeing longevity itself as an expensive problem, focus could shift towards managing morbidity and remaining life expectancy.

The continued refusal of the govt to accept that the issue of ageing population is a complex one and the unwillingness to question its Hard Truth on the issue continued in the face of evidence that the Hard Truth is doing real harm looks all too similar to the intellectual fetters that led central bankers to persist in tighten monetary policy in the early 1930s when faced with a global Depression.

It also shows that they are unlike LKY and Dr Goh Keng Swee who were willing to challenge the conventional wisdom that allowing MNCs in amounted to neo-colonialism. And demographics is not the only issue where the PAP govt is wedded to Hard Truths. Take welfare, where there is evidence that gd welfare systems do not reduce the will to work: they do not make people lazy e.g. http://www.bbc.co.uk/news/uk-scotland-24974745: another University of Edinburgh study.

Maybe, time to send scholars there to learn to walk on the wild side, and think unHard Truths? After all University of Edinburgh is a great university. It juz doesn’t produce the ruling elite of the UK or the US. Our scholars to to unis where the UK and US ruling elite are educated.

This call by a PAP,NTUC MP provoked me and someone else into some chim tots,MWC [Migrant Workers’ Centre] cautions workers and employers alike to access the Work Injury System honestly and fairly so that it can provide meaningful compensation to workers who have suffered physical incapacity or impairment from legitimate injuries suffered in the course of their work.

Someone posted on Facebook: From the way the statement by MWC is phrased, I think they should seriously rename themselves the Migrant Worker EMPLOYERS’ Centre, as it is clear they are more concerned about the employers’ interests than they are with the workers they claim to represent.

If the employer alienates the migrant worker for fighting for what he believes he truly deserves, shouldn’t the MWC take the employer to task for such a clearly discriminatory practice that is against MOM’s employment guidelines? Why side with the employer?

I responded to the poster: The unsaid assumptions (reasonable for a NTUC and PAP MP) are that the employers are usually fair-minded people, while migrant workers are out to cheat their fair-minded employers. LOL

I also posted:No matter how gd any system is, it can be gamed. The only way out is to give someone discretion to catch the gamers. Problem is that this leads to other problems*. BTW, gaming the rules is the reason the govt gives as an excuse not to legislate rights to many things that in other societies are accepted as part of the social fabric. Sadly the co-driver tends to agree with the govt. Only the SDP is prepared to challenge this self-serving excuse, not that I’m saying gaming will not happen. We juz have to accept that fact and change the rules, and accept that there will be abuses. Juz try to minimise it.

And as cutting and pasting this post, it struck me that the MAP, NTUC MP does not take into account in the statement, the imbalance of power and resources between the aggrieved migrant worker and an employer. One is on subsistence wages (by our standards at least), the other most probably drives a BMW or Mercedes and owns an apartment or two. This PAP, NTUC doesn’t know the meaning of social justice, and the need to level the odds in favour of the migrant worker.

—

*I was thinking of corruption. S’poreans are always complaining of the rigidity of the public service. One reason for such rigidity is that giving discretion to public servants, opens the doors to their exercising their discretion in return for monetary and other incentives. Hence the rule book.

It’s reasonable to conclude from the ST story that this demand for ITE and poly grads is the result of the govt’s very slight retreat from its “We love FTs, first, last and always” policies**. So whatever happened to the Hard Truth that the the more FTs, the more and better jibs for locals? Seems more like BS doesn’t it? But then the line between a Hard Truth and BS can be pretty thin.

for the record, Yeoh Lam Keong, former chief economist at GIC, has called for the immigration policy to be reversed. “What we need to do is to be much more stringent on admitting such unskilled labour. We’ve really got no excuse to be so relaxed about this kind of immigration.” (BTW, he has also called for the government to return to its roots to meet and serve the needs of ordinary citizens over public housing, education, healthcare, welfare and other services.)

If readers want to read, good, evidence-based critiques of govt policies, not the usual rhetorical rubbish that appears from most of the usual suspects most of the time, Uncle Leong excepted, follow “Lam Keong Yeoh” on Facebook.

Are we are more comfortable as serfs slaves PMETs in a financial centre?

A recent article, interestingly, makes a compelling argument that places that depend on the financial industry (like S’pore) are like resource-rich countries, and like them suffer from the triple problems of a high exchange rate that causes problems for manufacturers, revenue volatility and poor governance.

Is finance like crude oil? Countries rich in minerals are often poverty-stricken, corrupt and violent. A relatively small rent-seeking elite captures vast wealth while the dominant sector crowds out the rest of the economy. The parallels with countries ‘blessed’ with powerful financial sectors are becoming too obvious to ignore.

… has designed I-Corps as a way of converting the most promising science and engineering projects in American universities into start-ups. The I-Corps teams … comprise just a principal investigator (usually a tenured professor), a younger entrepreneurial lead (undergraduate, graduate or post-doctoral student) and an experienced entrepreneur or venture capitalist as a mentor. Each of the 100 or so teams has received a [US}$50,000 to cover a crash course on how to avoid the pitfalls common to all new ventures … New ventures, they are taught, are all about finding customers, what distribution channels to adopt, how to price the product, who to partner with, and more. From day one, the mantra is “get out of the lab” … The I-Corps programme is based on the premise that all new ventures are little more than a series of untested hypotheses—in other words, optimistic guesses about market size, customer needs, product pricing and sales channels. With so many unknowns, the programme teaches participants to treat their start-up as if it were a typical research project, amenable to the same iterative process of hypothesis testing and experimentation.

PM’s comments, “there are countries like China, Vietnam and India which are hungry and anxious to steal the lunch from us”, is pure inflammatory rubbish worthy of Gilbert Goh. They are not trying to steal from us. They are trying to improve themselves, by working harder (and perhaps smarter) than us. PM should leave anti-foreigner comments to Gilbert Goh and friends. Even TRE, TOC not into this kind of rubbish. The PM shouldn’t. But maybe he wants to talk on 5 October at GG’s “regime change” day.

Three other things wrong about his comment:

— Why is he comparing S’pore to these countries esp Vietnam? Tot, PM and his govt say we first world country like Switzerland, or global city like NY or London? I mean even manufacturers from China are moving to Vietnam because labour is cheaper there? What next compare us with Bangladesh or Burma?

— Productivity is more impt than working hard

And it seems that more productive—and, consequently, better-paid—workers put in less time in at the office. The graph below shows the relationship between productivity (GDP per hour worked) and annual working hours:

The Greeks are some of the most hardworking in the OECD, putting in over 2,000 hours a year on average. Germans, on the other hand, are comparative slackers, working about 1,400 hours each year. But German productivity is about 70% higher.

While there is nothing wrong with policies that are based on a ‘Singaporean first’ principle, it can be taken too far. Abuse of this principle could lead to racism, xenophobia and aggressive nationalism. By Wu Zijian

The regeneration of Manchester regeneration hasn’t benefited the whole population of the city equally. This is certainly true. The authors of the Manchester Independent Economic Review, published in 2009, found that in the first decade of the new millennium, while in absolute terms, every part of the city improved, inequality in the city had actually sharply increased. The richest bits of the city got richer at a much faster pace than the poorest bits.

I’m not sure that is a bad thing however. Even if we accept that growing inequality across the country is a bad thing, in this case, it strikes me as evidence of success. After all, as this Work Foundation report found, the most equal parts of Britain are towns such as Burnley and Sunderland. Those places are not more equal because the money is spread out more fairly. They’re more equal simply because everyone is poor. Manchester’s growing inequality, like London’s, is proof that it has managed to create well-paying jobs for at least a minority of its population.

Surprised our constructive, nation-building media, and the Breakfast Network and Independent are not telling us that rising inequality shows things are working. Maybe the media are waiting for media guidance.

But unlike Manchester, S’pore doesn’t have Manchester’s culture life that students find attractive: Cultural life feeds off economic success. After all, Burnley and Sunderland are not known for their great independent record shops and nightclubs. And it doesn’t have too EPL teams. BTW, for MU fans, the explanation for the defeat is simple: Allah and the Pope had the better of Yahweh on Sunday.

On the clubbing scene attracting students, I knew a German gal who chose to study in Manchester because of the nightclubs. She hated the weather though when she got there. BTW, while she was a party animal, she did very well in the IB exams, a perfect score.

The ST has for several weeks been writing about the loss of trust between the people and the govt, and laying the blame on the people (“daft”) who are distracted by the new media’s DRUMS beating the RAVII theme ( OK I exaggerate but juz a little). (BTW, here in a different context, I’ve looked at the role the new media plays: amplification, not distortion of the dissenting, inconvenient voices to the PAP’s narrative which the local media propagandises, while suppressing the former.)

Actually, the loss of trust is due to the PAP govt’s loss of “output legitimacy” since the 1990s.

“Output legitimacy” is the idea that elected leaders make decisions that are unpopular in the short term but will be approved by voters once their success has been demonstrated. A govt aiming for “output legitimacy” (most govts don’t, but the PAP is an exception) is a bold, self-confident govt because the govt and the politicians need to be proved right by events. Sadly for S’poreans and the PAP, the record doesn’t look that great for one LHL. He had been DPM, and in charge of economic and financial issues, and the civil service, since the 1990s, until he became PM in 2004.

Yet events have showed that S’poreans are discontented, not happy with the achievements of his govt. The PAP only polled 60% (lowest ever) in the 2011 GE, and three cabinet ministers lost their seats, with the WP winning for the first time ever a GRC. In the subsequent PE, the PAP’s “preferred” candidate and a challenger (ex PAP man too) polled 35% each. The preferred candidate won by a very short nose.

After all S’poreans concerns that housing, healthcare and public transport will remain affordable, and on education are the result of govt policies

His dad introduced the concept “output legitimacy” to S’pore (although not the term: too highfaluting perhaps?), partly because it suited LKY’s personality (intellectual thuggery, the belief that “leaders lead” and shouldn’t be governed by opinion polls, and micromanaging**), and partly because while S’pore was a leading Asian city in the 50s and 60s (as LKY and PAP haters like to remind us ad nauseum), that wasn’t saying much for most S’poreans: err bit like now, one could reasonably argue. Examples:

— When the PAP came into power in 1959, unemployment was over 10%; and

— in 1960, 126,000 man-hours were lost in strikes as compared to 26,000 in 1959.

There were then things that had to be done that would upset many people most of the time for a while. But if the policies worked, then the results would be visible. Well, at the very least, the voters were prepared to give LKY and the PAP, over 70% of the popular vote and all the parly seats for over a decade.

The world’s now a bit more complex since then, and S’poreans’ expectations have rightly risen, so whether it is ever possible that the PAP govt can ever recover “output legitimacy” is open to question even if it has the ‘right” people leading it. But at least it’s willing to spend more of our money on making life a more comfortable for ourselves. Maybe that should be its articulated goal, to frame our expectations of its “output legitimacy”.

Maybe the constructive, nation-building media, and new media outlets that believe in constructive criticism, like the Breakfast Network and the Independent*** can help the PAP govt? Better than flogging the dead horses of trust, daft people and that the internet beats DRUMS to the RAVII theme.

—

*Recriminations, Accusations, Vilifications, Insinuations & Insults

**Remind me of the bible verses: “Are not five sparrows sold for two farthings, and not one of them is forgotten before God?” or “Are not two sparrows sold for a farthing? and one of them shall not fall on the ground without your Father.”

***Independent sucks because it got its branding wrong. Name is so traditional media. In fact there is an established UK newspaper by that name.

Names with a whiff of the establishment seem old hat. Chris West, founder of Verbal Identity, specialists in linguistic branding, says that “they appear to be hankering after a debased culture of corporate magnificence”. Consumers think of them as pompous, self-serving, impersonal. The advantage of calling your business Wonga and GiffGaff lies in the rejection of superfluous formality. We perceive them as younger, more in-touch, less “corporate”. As Mr West concludes, “they sound like words we might hear at the pub”.

Then there is the quality of its writing. But that shows up the pedigree of two of its founders.

As for BN, it’s a work-in-progress, and it’s a gd training place for budding journalists: got ex-TOCer who has learnt to write proper, readable English. So I wish it well, even if I’ve heard allegations about its funding. And it has a great name. Spent a lot of cash getting its name right?

In return, the govt has been moaning that S’poreans no longer believe in the value of NS. It tries to make NS more “valuable” for us via gimmicks rather than hard cash (“Money talks, BS walks”) and addressing the the issue of defending someone like new citizen Raj and his family.

Apart from addressing the issue of defending people like new citizen Raj and his son, methinks the ministers and ESM should reach for a 6th September article in FT (behind a pay-wall). It is an opinion written by Mark Mazower, professor of history at Columbia University and author of ‘Governing the World”. It is entitled, “The west needs a replacement for the warrior spirit”.

Cutting to the chase, I quote the following:

The late Charles Tilly demonstrated in a series of brilliant sociological studies the extent to which warfare and welfare have historically been tightly connected. Rulers who wanted citizens to fight learnt the hard way that they had to give them something more concrete and appealing to fight for than the privilege of dying in their name. That is why the advent of mass conscript armies, unified around allegiance to the nation, coincided with the dramatic 20th-century transformation in the nature of the state and the swift post-1945 expansion of social rights in the shape of public housing, healthcare and schooling.

During the two world wars, military service resulted in the percentage of the population in uniform in the UK and the US approaching an extraordinary 10 per cent. This kind of warfare accustomed entire societies to new egalitarian norms and demonstrated the indispensability of the state itself as mediator in industrial relations, and as economic strategist and planner. The lessons were learnt and applied after the war as well, underpinning much of the west’s managed capitalism in the years of the post-1945 economic boom.

Get it PAP govt? NS and the welfare state go together. Israel and Switzerland, countries still with NS, have gd welfare systems, BTW.

Maybe, since the PAP doesn’t want a welfare state, scrape NS? Has the additional benefit to the PAP of getting rid of the issue of us defending new citizen Raj and his family. We might be willing to be more amenable to more two-timing new citizens, like Raj.

No, not us. We are none of these, though we got many of the u/m conveniences, sort of.

Estonia (population 1.3m) is a world leader in technology. Estonian geeks developed the code behind Skype, Hotmail and Kazaa (a precursor of the Napster file-sharing software). In 2007 it became the first country to allow online voting in a general election. It has among the world’s zippiest broadband speeds and holds the record for start-ups per person. Its 1.3m citizens pay for parking spaces with their mobile phones and have their health records stored in the digital cloud. Filing an annual tax return online, as 95% of Estonians do, takes about five minutes. How did the smallest Baltic state develop such a strong tech culture?

Mr Ilves, a co-founder of Skype the president says Estonia’s success is not so much about ditching legacy technology as it is about shedding “legacy thinking”. Replicating a paper-based tax-filing procedure on a computer, for instance, is no good; having such forms pre-filled so that the taxpayer has only to check the calculations has made the system a success. Education is important, too: last year, in a public-private partnership, a programme called ProgeTiiger (“Programming Tiger”) was announced, to teach five-year-olds the basics of coding. “In the 80s every boy in high-school wanted to be a rock-star,” says Mr Hinrikus. “Now everybody in high-school wants to be an entrepreneur.” Mr Hinrikus is a co-founder of Skype.

So PM is working hard on his National Day Rally speech, at least he said so about a week ago. (He shouldn’t be working hard, he should be working smart: hard work is no substitute for using one’s intellect, which PM has in spades, effectively. If working hard were all that mattered, the FTs toiling on our work sites would have it made.)

We have been told that he will focus on public concerns that housing, healthcare and public transport will remain affordable, and on education (I assume, affordability and the stress it causes pushy parents with average kids). He will most probably talk about jobs (including low or stagnating salaries, and how the govt is tackling these issues), as the concerns for good jobs has also been raised at these talk cock sing song Our S’pore Conversation sessions.

Interestingly in February 1958, this was written by an ang moh reporter: “But, governors may come and may go: but the problems of government are the same. The problems that remain in Singapore are housing, health services, education and expansion of industry.”*.

Well the PAP won the 1959 general elections and have governed S’pore since then, and the problems are the same.

By addressing the issue of affordability, will he implicitly be sending the message that he is be ditching dad’s Hard Truth that populism is bad**?

Not if Education Minister Heng Swee Keat, the minister in-charge of Our Singapore Conversation (OSC), is to believed. He told the media this week that OSC is not a knee-jerk, “populist” policy-making exercise. It is not a “major meet-the-people session”, with the govt collating a wish list and then giving the people what they want. He emphasised that OSC does not sacrifice any strategic thinking on the part of the govt for the sake of showing empathy with the people.

But, he would say this wouldn’t he? Let’s juz ignore the DRUMS and the noise, and focus on the effects. “It doesn’t matter whether a cat is white or black, as long as it catches mice,”, said one Deng Xiaoping.

Anyway, Simon Johnson, once the Chief Economist at the IMF, home of austerity’s the answer to almost any economic problem, and now the Ronald A. Kurtz Professor of Entrepreneurship at the M.I.T. Sloan School of Management, Populism and irresponsibility are not, in fact, synonyms. Populism can be sound, he argues. He argues that populism is often used in a pejorative way – as a putdown, implying “the people” want irresponsible things that would undermine the fabric of society or the smooth functioning of the economy.

Next, hopefully (from the perspective of PAPpies, and those of us S’poreans who treasure stability, efficiency and rent-seeking over human rights and democracy), PM works smart on his “likeability”, not on his power point presentation. One of these days, I’ll blog on why he has a great personal story to tell. A preview: overbearing, overachieving father with high expectations who refuses to retire gracefully into old age. And there is more.

PM’s dad was respected and feared. But PM’s not his dad, and times have changed. Kind-heated intellectual thuggery, bullying and hectoring are no longer in fashion with voters. So being “likeable” is very impt.

An analogy with the Catholic Church (Dad used to claim that PAP cadre system was based on the way the cardinals elected the pope, while the pope chose the cardinals, though analysts have pointed out that the PAP’s cadre system more closely resembles the Leninst way organising a “dictatorship of the proletariat”. The best example of this is the way Chinese leaders are elected to run the ruling party and the country.) shows why PM needs to be likeable if the PAP is dominate S’pore politics and life for another 50 years.

So far people have generally taken at face value the image of Francis as a “barefoot pope” who is personally modest, feels compassion for the disadvantaged and is endowed with a basic human warmth that his predecessor seemed at times to lack. He is simply likeable, and that ensures that he commands some respectful attention (even from those who disagree with him) when he seems to be speaking from the heart.

As he works smart (not hard) on his speech, he should remember the recent Cambodian elections where the opposition united against a strongman leader who brought prosperity to his country and who sued his opponents for damages and who keeps the media on a very tight leash. It has at least deprived the govt of its two-thirds majority (if not winning the election). (https://atans1.wordpress.com/2013/08/03/cambodian-elections-harbinger-of-sporean-ge/)

All to play for PM.

And keep up the good work of reforming the system. I may not always agree that he is doing the “right” things but I will concede that are trying hard, whatever his motives. But, like the Red Queen in “Through the Looking-Glass, and What Alice Found There”, he is running to keep up with S’poreans rising expectations of change and a better life. To quote Tocqueville as I did here:

experience teaches us that, generally speaking, the most perilous moment for a bad government is one when it seeks to mend its ways….Patiently endured for so long as it seemed beyond redress, a grievance comes to appear intolerable once the possibility of removing it crosses men’s minds.*

To sum up: What S’poreans need and want to hear from the PM is what the PAP govt stands for, what it believes, how the govt now would be different from the one before. And that needs to be set out with absolute clarity in a language that S’poreans can understand and empathise with.”

The problem is that PM has been part of the govt since the 1980s, and DPM, and economic, financial and civil service czar in the 1990s and early noughties, and PM since 2004, making it difficult, if not impossible, for him to say move on from the past. He was a major creator of the problems that caused the disconnect between a substantial number of voters and the PAP govt, that he as PM now has to repair.

Even dad would find this impossible to do.

Churchill and FDR juz might have managed to do it, but our PM is no Churchill or FDR, let alone his dad.

“Singapore Correspondent” covers five years of Singapore’s colourful political past – a period of living turbulently and sometimes dangerously. It is a collection of eye-witness dispatches, sent from Singapore to London, spanning a time when Singapore was emerging from British colonial rule and moving forward to self-government and independence. Many of the early struggles of the People’s Action Party (PAP) are described as the focus is on the political struggle taking place in which the PAP played a major part. Many important events which have long been forgotten are brought to life. These dispatches prove that political history need not be dull, and indeed can sometimes be entertaining and lively.

**Coming a few days after dad launched his latest book on Hard Truths, it may look like he’s giving dad a very tight slap+. Tot that was job of co-driver? Trying to make WP redundant? Or Low and gang not doing enough, preferring to share out contracts and enjoying their salaries? And this reminds me of: Former Singapore Prime Minister Lee Kuan Yew’s views expressed in his new book, One Man’s View of the World, are “obsolete,” said Datuk Seri Anwar Ibrahim.

The views represented the Mahathir generation, he added.

“We should not always look at the dichotomy between rights and race, black and white.

“For example, he (Lee) talks about race-based policies, but there is very little understanding of the discourse in the last decade,” he said.

Anwar said Lee was still “trapped in the old mindset,” when he used to be in the opposition during Malaya before Singapore was established.

“His thoughts are not so relevant now in the context of the present day. That is what prompted him to make sweeping statements to generalise the situation in Malaysia,” Anwar told reporters … [Star]

+Filial piety? What filial piety? At least PM learned the lesson from dad that eggs must be broken to make omelets: that the ends justifies the means. LKY should be proud that his son has at least learned this.

I kid you not, miracles can happen. LKY agrees with the Blogging 7, Uncle Leong, E-Jay, s/o JBS, NSP, SDP and all the usual players of DRUMS. The latter have always argued that low productivity is the result of the FT policy. Not included Low or WP among the latter as I don’t know itheir stand on this issue.

StooliesFoils, Comedy Straightmen ST: On the issue of making productivity gains, we lag behind many developed countries. In manufacturing and services, Singapore’s productivity is only 55 per cent to 65 per cent of that in Japan and the United States.

LKY: Because we have large numbers of migrants who do not fit into the workforce so easily and who do not speak English.Some hold work permits and do not stay for long – they leave within a few years, after developing skills.

Manufacturing firms in Singapore relied on low-skilled foreign workers as substitutes for machinery between 2003 and 2008, sacrificing productivity levels in the process, according to a study.

The Ministry of Trade and Industry (MTI) study released yesterday, however, found that other factors – unrelated to foreign workers – could have also caused the decline in automation, underscoring the need for greater R&D and product innovation.

The five years in question mark the government’s most recent period of liberal foreign labour policy. Between 2003 and 2008, the dependency ratio ceiling – which specifies the maximum proportion of foreign workers that companies can hire – was raised to 65 per cent; levies for unskilled work permit holders were reduced; and firms were allowed to hire work permit holders from China.

In its study of 1,500 manufacturing firms over that period, MTI found that those which hired relatively more low-skilled foreign workers relied less on machinery for production.

Doesn’t LKY’s words and the MTI study show that the govt talk of increasing productivity over the yrs (from 1990s onwards) was juz that: talk? And now, the guy that was charged with leading the productivity drive in the late 1990s is now the chairman of Temasek? Isn’t S’pore a meritocracy, unlike M’sia?

Where LKY and the DRUMS would disagree is what would have happened if FTs didn’t come in by the cattle-truck load:

But you ask yourself how many small and medium-sized companies will pack up if we cut off the foreign workers?

But isn’t it a chicken-and-egg situation? Precisely because it is so easy and cheap to hire foreigners, the SMEs continue to rely on them. If the tap were tightened, they would be forced to find new ways of operation. There will be some that will shut down, but maybe some level of churn is necessary so that the economy can go on to be more productive.

You cut them off and you find the SMEs just caving in.

Would that be a bad thing, or could that just be a necessary transition?

If our SMEs collapse, we will lose more than half of our economy.

In a way, that is what the Government is now trying to do. They are trying to slow down the growth in the foreign labour force.

Yes, because the Singapore public feels uncomfortable with so many of them. Not because of the economics. From an economic point of view, we should grow.

So how do you see this ending now that we have started to tighten the tap? Does it mean that we will lose half of our economy?

As you bleed out the present workers on work permits, the economy will shrink. But we are keeping the same level and just slowing down the inputs of new workers. Not stopping them. You stop it, you are in trouble.

The DRUMS would argue that the SMEs wouldn’t collapse or move on. They would adapt. I don’t think any elected govt would dare take the risk of allowing SMEs to collapse. It could lose power. As Dr Goh liked to say, repeating a Western political aphorism, “Oppositions don’t win elections, govt lose them.”

S’pore is richer (per capita) than Japan. Yet as this chart from the Economist shows, its welfare spending is below that of Japan, and is clustered with Thailand and China, with only Indonesia worse-off. Korea is slightly better than S’pore but the president there has promised massive welfare spending. S’pore has not made such a promise.

We should be aiming to be clustered withJapan. And as Temasek’s recent results help show, we got the money. Prosperous Japan is the only country that protects its people both well and widely, according to the index. In Singapore, now richer than Japan, social protection is spread broadly but thinly, the index shows.

For the geeks:The Asian Development Bank’s newly published social-protection index shows both the breadth of coverage (the percentage of potential beneficiaries actually covered) and the depth (the amount of spending per beneficiary, expressed as a percentage of the country’s GDP per person).

The inventors of Skype came from Estonia. More importantly, the economy there is using IT to leverage its productivity. Not like S’pore where FTs are thrown at any problem.

Estonian schools are teaching children as young as seven how to programme computers.

Estonia’s e-revolution began in the 1990s, not long after independence. Toomas Hendrik Ilves, then the country’s ambassador to the United States, now Estonia’s president, takes some of the credit … He read a book whose “Luddite, neo-Marxist” thesis, he says, was that computerisation would be the death of work.

The book cited a Kentucky steel mill where several thousands of workers had been made redundant, because after automatisation, the new owners could produce the same amount of steel with only 100 employees.

“This may be bad if you are an American,” he says. “But from an Estonian point of view, where you have this existential angst about your small size – we were at that time only 1.4 million people – I said this is exactly what we need.

But, a true blue S’porean might wonder why despite all the money thrown on R&D, and all the praise that our MSM reports on our “innovation”, things like this get invented in the UK, a place that one LKY used to rubbish regularly.

As usual the grumblers are out on TRE, TOC and Facebook. The question they are bitching out loud is, “Why is the govt spending our money on subsidising wage increases?”. And asking, “What about introducing a Minimum Wage?”

I’ve this fantasy that when the govt introduces a Minimum Wage scheme, these same people who say that this scheme is bad for S’pore: which it is*.

Coming back to subsidised pay rises, other than to win votes from the many S’poreans who don’t belong to Team “Govt, PAP are bastards” or “PAP govt is always wrong” or “We always bitch against the PAP, govt”, there is a good economic reason for the govt subsidising wage rises.

Rising wages give employers an incentive to increase the return to recruiting and training, if they can no longer bring in FTs by the cattle-truck load to off-set rising wages for locals. At the same time, rising wages make it more attractive for older S’poreans to look for work, rather than go online and complain about everything, while making it more attractive for employers to drop their prejudices and discrimination against the elderly.

(Having said all that, there is an educated oldie at the Marine Parade polyclinic that I wish wasn’t working there.)

And given that the SMEs are screaming that the govt is killing them by cutting off the supply of FTS, how else to give S’poreans a wage rise, on top of CPF employer rate rises.

And better to spend our money on fellow S’poreans rather than giving it to our SWFs who will spend some of it on ang moh investment bankers who bring them lousy deals.

Most relevant excerpt: There are conditions under which raising the minimum wage will increase demand, as well as economic efficiency. According to one story, monopsony conditions for low-wage labour, ie, imperfectly competitive labour-market conditions in which there is but a single buyer of low-wage labour (or a colluding band of buyers) that is able to set wages at a level workers have little choice but to accept. Good old Econ 101 shows that under such conditions, a bump in the minimum wage, within a certain range, can boost employment and enhance efficiency. So there’s that. And such conditions no doubt exist in some sectors at some places at some times. One famous, and egregiously misused, study suggests that monopsony-like conditions applied to fast-food restaurants in Pennsylvania and New Jersey in the mid-1990s. But there is basically no reason whatsoever to think that such conditions apply generally, across all sector and regions of the American labour market.

In the absence of special conditions, we have every reason to expect the law of demand to hold, such that raising the minimum wage will make it harder for inexperienced workers—workers whose output is worth less to employers than the mandated wage, and especially teenagers from low-income families looking to get a first footing in the labour market—to find work. And this is, in fact, what empirical studies tend to conclude. A comprehensive 2008 survey of the empirical literature from David Neumark, a professor of economics at the University of California, Irvine, and William Wascher, an economist for the Federal Reserve, found that, as one would expect, “[M]inimum wages reduce employment opportunities for less-skilled workers, especially those who are most directly affected by the minimum wage.”

Again, it doesn’t have to work this way. Employers can cut hours rather than hiring fewer workers. They can turn down the air-conditioner, strictly police the length of breaks, and otherwise reduce the cost of amenities previously enjoyed by employees. They can shift to off-the-books employees willing to work for less than the legally-mandated minimum. They can raise prices, passing on increased labour costs to consumers. It’s conceivable that the only consequence would be that a larger share of profits gets distributed to low-wage workers. Conceivable and exceedingly unlikely. In reality, we probably get small adjustments along each of these dimensions.

According to ST editor Han Fook Kwang in his weekly SunT column (pg 37) “it isn’t possible for ordinary Singaporeans to absorb and fully understand all the arguments and implications. arguments and implications highlighted in the Population White Paper”. Hence our opposition. Hello Mr Han, so how come four leading S’porean economists, scholars all wrote this http://www.tremeritus.com/2013/02/09/economics-myths-in-the-great-population-debate/ (I’m linking to this republishing ’cause of the comments section)

So these four are daft too?

He was riffing on what the PM said, “Govt could have presented Population White Paper better”. And going further anddaring to call us openly what PM didn’t dare?

So how come,

— the Chief Communications Officer of the govt, s/o the former disgraced president,

— an unemployed MP who was the head of the regional business of an int’l PR firm,

— the editorial teams at SPH and MediaCorp,

— CoC Yaacob and his team at the Ministry of Truth & Spin, and

— the numerous PR senior managers in the govt and its agencies,

didn’t advise the PM and DPM Teo to take account of our daftness when presenting the PWP?

They too out of touch with us daftees? Or they dafter than us? Or did PM and DPM Teo ignore their advice? Hence they more dafter than everyone else in S’pore.

The ST Managing Editor, as a member of the Dark Side, should be using his skills to prevent us from thinking? Not provoking us to think “unhealthy”, non-constructive tots: like there are daft Men In White on the Dark Side.

Late last week, four FT PRC SMRT drivers appeared in court again. They had been charged for inciting and participating in an illegal strike.

On Sunday, I read the following on Facebook: “What a tale this is. Clandestine meetings with ministers, secret agreements with shadowy power-brokers. The Last Great strike is an uplifting, thoroughly Singaporean story that belongs on the shelf of every Singaporean home and classroom.- Singapore’s top-selling author NEIL HUMPHREYS commenting on THE LAST GREAT STRIKE.”

As I’ve written before, this book is written by a friend, Clement Mesenas. His dad grandfather was a Pinoy FT who came here in the 1930s early 20th century. The book “looks back on eight eventful days in 1971 when a group of young reporters staged a historic strike that shut down The Straits Times” for the first time ever in its 120-year history.

I joined the two dots: the book should have been subtitled: “How to organise a legal strike”.

I mean, Clement and his other Indian Chief friends (no Indians among the core team, so no racism intended) were so good that Labour Minister Ong Pang Boon told the Indian Chiefs: “All right gentlemen, let’s plan a strike.”

And so should the rumoured wannabe prime minister, MOM Tan, his MOM bureaucrats, SMRT’s managers, other managers, and NTUC officials, go buy and read the book, because the book explains why strikes happen:

— poorly paid workers (“Most of us in the newsroom were broke well before the end of the month … An egg could be cracked onto roti prata for an additional 20 cents, but that was a luxury as those 20 cents could be saved for the bus ride home.”); and

— “parsimonious, disdainful … management”, Tan Wang Joo, former editor of The Sunday Nation, and a deputy editor of The Straits Times.

So we now know that the 6.9m figure in the White Paper is a “worse-case scenario”

— “Reiterating that the 6.9 million figure should be viewed as “the worst-case scenario”****, Mr Khaw wrote: “We hope we do not reach that figure; we may never reach that figure.”

–” Prime Minister Lee Hsien Loong said … he fully agrees with Mr Khaw’s explanation that a 6.9 million population is not a target, but just a worst-case, aggressive scenario the Government must prepare for.”

(Excerpts from MediaCorp)

So why didn’t the media tell us this when the media reported the White Paper? The media reported the figure of 6.9m as though it was set in reinforced concrete that had platinum bars rather than steel bars. Surely when the staff of the s/o the disgraced president, and Yaacob*gave the local media their instructions local journalists and editors the customary briefing, they made it clear that the 6.9m figure is a “worse-case scenario”? And that the figure was used to ensure that there would be adequate infrastructure should this happen, which the government didn’t want to happen. And that if it didn’t happen, S’poreans would have even better facilities for which they should thank the PAP on bended knees.

But these messages were never reported. They came to the attention of “the inhabitants of cowboy towns” who were happily shooting holes into the White Paper, and other S’poreans only when the PM Facebooked and Khaw blogged these messages.

Then the local media parroted reported what the PM and Khaw had said.

Either the local media are staffed by stupid people, or are full of subversives, who take their 30 pieces of silver ** while saboing the PAP government. Or maybe the going rate is a lot more than 30 pieces of silver? And they are not getting it? Hence the government’s messages didn’t get broadcasted.

Or were the minions of s/o Devan Nair, and Yaacob, incompetent, stupid spinners? Journalists and editors are claiming that they were never ordered briefed that the 6.9m figure was a “worse-case scenario”. They claim to be as surprised as us netizens that the PM and Khaw are now making this claim.

Whatever it is, if WP Low is to get his wish of continued PAP hegemony, PM should get a grip on the PAP spin machine. He and his ministers can’t do all the spinning themselves. Maybe Auntie Sylvia or Show Mao, in emulation of a Tang dynasty official, can whisper this to the PAP, “behind closed doors”. Remember WP, yr mission is to preserve PAP hegemony.

—

**He used the phrase “worse-case scenario” when one LKY gave his Hard Truth on Malay Muslims not integrating.

In “Planet of Cities”, by Shlomo Angel*, a professor of urban planning at New York University, argues that cities must prepare themselves for rapid growth, citing New York and Barcelona: In the 19th century both cities decided to prepare themselves for rapid growth. In 1811 New York’s city council approved a plan which allowed all of Manhattan to be built up and included the island’s now famous street grid. In 1859 Barcelona followed suit with a similar concept to expand the city nine-fold.

Netizens, pls realise that the intellectual underpinnings are there for the White Paper. It’s the conventional wisdom. Raving, ranting and screaming will do no good.

Nothing will, not even the ballot box: “A vote for the WP is a vote for the continuance of PAP policies” says WP Low. So lie back and enjoy being raped. Think of the value of your property when you cash out and move on overseas.

“Do you want faster growth or do you want fewer foreign workers? Do you want more hard work or more leisure? Do you want more competitive schools and good results and good futures, or more relaxed schools and fall behind? How can we find that balance in between?” the Prime Minister asked. Whatever the hurdles, he emphasised that the PAP had always been open with Singaporeans, even when these trade-offs may be unpopular — SPH.

I got two gripes with the above remarks by PM.

Firstly, as usual he is framing* the issues in such a way so as to try to get us to answer the way he wants us to answer them. Dad used to do this successfully when we didn’t have the best education system in the world, when issues were less complicated, and when there wasn’t the internet. But times have changed, but PM hasn’t shaken off daddy’s influence.

— “Do you want faster growth or do you want fewer foreign workers?” Well how about asking, “How can we have faster growth without FTs? Can we substitute robots, or pay higher wages?” And more fundamentally what about, “Do we need faster growth? What about better quality growth?”

— “Do you want more hard work or more leisure?” What about asking,”Can we work smarter to have more leisure?” Or more fundamentally, “Are we working smart? Or are we working harder because we are not working smart?”

— “Do you want more competitive schools and good results and good futures, or more relaxed schools and fall behind?” Shouldn’t we be asking, “Are there other ways of educating S’poreans that ensure national prosperity and self-development?”

The FTs came pouring in on the quiet. The government was not open on this issue, public housing and transport, and inflation.

Mah Bow Tan was telling us that his HDB building programme was sufficient when S’poreans were saying it was insufficient. Well fact that Khaw has accelerated and expanded the building programme shows that Mah was wrong, if not in denial.

And remember Raymond Lim said GST had to rise when we bitched about overcrowded trainds and buses: he implied that we juz wanted more comfort and so should pay for it. He was wrong or in denial about the problem. Well the massive spending plans, shows that we were right to get upset.

And inflation. I’ve gone on and on about Tharman and Hng Kiang saying that higher inflation doesn’t affect S’poreans who don’t buy cars. That is obfuscation, not openness.

But never mind, the PAP can remain complacent because Low has publicly implied that a vote for the WP is a vote for continued PAP rule.

Not that I’ll complain too much. The low-tax environment and the emphasis on making sure property prices “cheong all the way” have allowed me to stop working in my 40s. And have the time to think; and grumble, constructively, I hope.

TRE readers are forever screaming that the PAP govt wants to swamp S’pore with citizens born overseas. They might like to know that in 1959, according to the u/m book, only 270,00 out of the 600,000 voters were born here. If TRE readers are correct, the PAP is only restoring things to as they were when the PAP came into power. Is that so wrong? LOL.

Interestingly the author reported that when one LKY revealed the above fact in 1959, LKY also said,”we must go about our task (of building up a nation) with urgency … of integrating our people now and quickly”. Maybe he repented building up a nation?

“Singapore Correspondent” covers five years of Singapore’s colourful political past – a period of living turbulently and sometimes dangerously. It is a collection of eye-witness dispatches, sent from Singapore to London, spanning a time when Singapore was emerging from British colonial rule and moving forward to self-government and independence. Many of the early struggles of the People’s Action Party (PAP) are described as the focus is on the political struggle taking place in which the PAP played a major part. Many important events which have long been forgotten are brought to life. These dispatches prove that political history need not be dull, and indeed can sometimes be entertaining and lively.

Given that Christmas is the season of goodwill to all men (including the PAPpies) and given that the PAP has had a torrid time, and given that Fabrications about the PAP is not doing its job, I tot I should post some facts and analysis (not Hard Truths) that support a policy that has pushy parents and netizens upset.

Sometime back, when

— PM said the desire for “personal growth” 9i.e. a university degree has to be balanced with jobs; and

— the education minister said that while the govt would increase the number of places in local universities for locals, there would be a limit (I think he said 40% of some “mark”),

both were given a hard time by netizens and pushy parents.

I was reminded of the above recently, when I surfed across a few articles recently that discussed the skills needed to get jobs in a developed economies.

In a McKinsey survey of Western countries, nearly 70% of employers blamed inadequate training for the shortfall in skilled workers, yet 70% of education-providers believe they suitably prepare graduates for the jobs market. Similarly, employers complain that less than half of the young whom they hire have adequate problem-solving skills, yet nearly two-thirds of the young believe that they do have such skills.

Perhaps the young and their teachers need to take a reality check said the Economist writer who reported this.

Then there is this: As some Canadian industries struggle to find skilled workers, others face a glut of qualified candidates and not enough jobs to go around. University professor Peter Fragiskatos says emphasising the importance of a university education only makes the problem worse.

He writes: Notions of success in Canada have been, and remain, intimately connected to obtaining a university degree. Why? After all, Plato, Aristotle, Nietzsche and Heidegger can be discovered just as easily at a public library and for a much cheaper price.

All of this might sound strange coming from someone who teaches at a university. While the joy I feel when working with my students cannot be put into words, the experience has made me realise that a love for learning is not their leading motivation, if it ever was.

Most have been raised with the idea that a secure future will only be possible with a BA or a BSc, and they enrol in university for this reason. As they get older, today’s students are likely to pass along the same message to their kids.

The reality is that Canadians are living in a new era, one where a technical education – usually obtained at a community college – has the prospect of delivering not only a steady job but better pay than what university graduates typically make.

Engineering, mining and many health-related professions – the three areas identified by Tal’s report as most in need of qualified applicants – do not require a university degree.

Finally from an Economist blog the work of Cambridge economist Chang Ha-Joon,has noted that Switzerland*—one of the richest countries in the world and the nation with the third-highest ratio of Nobel scientists per person—has a lower rate of college enrollment than every other rich nation, as well as other beacons of prosperity like Argentina, Lithuania, and Greece. In fact, once a country has crossed some very low threshold, there is no relationship between the number of graduates and national wealth. The explanation is simple: a typical college education does not linearly increase labor productivity. This is not necessarily a bad thing—there is more to life than making money, after all.

So maybe, the govt is right to put the emphasis on vocational education, with scholarship schemes like this?

Fat chance that most readers of TRE and TOC, and pushy parents would concur. For the former, the govt, PAP, NTUC and related entities are always wrong. Take Zorro Lim’s statement that NTUC says ‘no’ to equal pay for all nationalities because “Same job-equal pay” rule will put local workers and families at a disadvantage. Facebookers and some bloggers were bitching about this. If he had said “yes”, they would be bitching too.: S’poreans must come first. Wonder how these people feel, now that ST (whom they rightly bitch abt) agrees with them that sMRT should only use the English station names in its public announcements. LOL

—————————–

*S’pore’s spending on education is only around 3% of GDP (about halve of Switzerland which is in line with developed countries), so we got to spend a lot more to have a Swiss-style standard of education. Unless the govt wants us to be third world in education, like on workers’ and refugees’ rights.

(Update on 3 January 2013: He has joined Keppel Gp, a TLC, and not as expected his father-in-law’s property company. I’ll be blogging on this next week. Want to try to find out if his in-laws scared that their workers’ will go on strike or be unhappy if he joined them. I mean his record at SMRT/ NTUC not too good.)

Our nation-building constructive media are ignoring the white elephant in the space where of the circles of TLCs/GLCs, PAP, NTUC and the civil service meet: sometimes also known as S’pore Inc.

Once upon a time, Ong Ye Kung, was S’pore Inc’s poster boy of meritocracy.

Just in April 2011, before the May GE, our nation-building constructive media praised him as an example of meritocracy at work. Son of a Barisan Socialist MP (and no friend of one LKY), he was a scholar* who rose to a senior civil service post**, then became a senior NTUC leader, and then a PAP MP candidate. It was whispered that he was Zorro Lim’s anointed successor as NTUC chief; and was tipped by ST as a future candidate for ministerial office. He did became the NTUC’s Deputy Secretary-General in June 2011.

But by then his slave worker drawn chariot had gotten stuck in the mud . He was a member of George Yeo’s losing Aljunied GRC team. Worse was to follow in 2012: the wheels came off his chariot of gold and ivory and he was thrown-off, and cast into the darkness and mud and became a person that the constructive, nation-building media knew not.

Earlier this year, SMRT’s S’porean drivers made known publicly their unhappiness over pay proposals that had his endorsement as Executive Secretary of NTWU (Nation Transport Workers’ Union). As he was also a non-executive director of SMRT, if he were an investment banker, a US judge would have rebuked and censured him for his multiple, conflicting roles.

Then he resigned, effective last month, from NTUC to “join the private sector”.

In perhaps a farewell, good-riddance gesture, FT PRC workers went on strike (illegally) and we learnt:

— they lived in sub-standard accommodation (SMRT admitted this);

— unlike most SBS FT PRC drivers, most of SMRT’s PRC drivers were not union members; and

— Ministry of Manpower reprimanded SMRT for its HR practices.

All this reflects badly on Ong: NTUC’s Deputy Secretary-General, Executive-Secretary of NTWU and SMRT non-executive director. And on the system that allowed him to rise to the top. After all his ex-boss said the following reported on Friday, which given Ong’s multiple roles in SMRT, can reasonably be interpreted as criticism of Ong:

In his first comments on the illegal strike, which saw 171 workers protesting over salary increases and living conditions, the Secretary-General of the National Trades Union Congress (NTUC) said the labour dispute “shouldn’t have happened” and “could have been avoided”. [So where was Ong: looking at his monthly CPF statements and being happy?]

NTUC is thus reaching out to SMRT’s management to persuade them “to adopt a more enlightened approach to embrace the union as a partner”, he added. [Hello, NTUC’s Deputy Secretary-General was on SMRT’s board, so what waz he doing?]

Mr Lim, who was speaking to reporters on the sidelines of the Labour Movement Workplan Seminar, cited the example of SMRT’s rival SBS Transit where nine in 10 of its China bus drivers are union members. Only one in 10 of SMRT’s China bus drivers are union members, according to union sources. [So, why didn’t Ong advise SMRT to help unionise these FTs, and if he did, why didn’t NTUC push harder ehen SMRT refused?]

SBS Transit’s management “recognised the constructive role of the union”, while union leaders “played the role of looking after the interests of the drivers”, said Mr Lim.

“And as a result … they work very closely as one team, it’s a win-win outcome. In terms of how workers are being treated and respected, how management are responsive, how they work together, I think it’s a kind of model that we ought to see more and more in Singapore.” (Today)

Apparently, Ong is supposed to join his father-in-law’s property development business: but with this revelations, it should come as no surprise if his in-law’s family has reservations about him: he might mismanage and upset the workers. Property development companies are fragile because of their leverage: they can’t afford executives who can’t execute.

And if anyone is wondering about the origins and meaning of the term “feet of clay”:

Thou, O king, sawest, and behold a great image. This great image, whose brightness was excellent, stood before thee; and the form thereof was terrible.

This image’s head was of fine gold, his breast and his arms of silver, his belly and his thighs of brass,

His legs of iron, his feet part of iron and part of clay. (Daniel 2:31-33)

…

And whereas thou sawest the feet and toes, part of potters’ clay, and part of iron, the kingdom shall be divided; but there shall be in it of the strength of the iron, forasmuch as thou sawest the iron mixed with miry clay.

And as the toes of the feet were part of iron, and part of clay, so the kingdom shall be partly strong, and partly broken.

And whereas thou sawest iron mixed with miry clay, they shall mingle themselves with the seed of men: but they shall not cleave one to another, even as iron is not mixed with clay. (Daniel 2:41-43)

…………………….

*From 1993 to 1999, he was in the then Ministry of Communications, where he helped develop the Land Transport White Paper and was part of the team which established Singapore’s Land Transport Authority. Taz right, he was there at the beginning of the great SMRT cock-up.

**He was the Principal Private Secretary to one Lee Hsien Loong, then became the CEO of the Singapore Workforce Development Agency.

In 1988, S’pore was the 36th best place to be born in: same as East Germany. M’sia was 38th and HK was 7th. In 2013, according to an article (The lottery of life) in an Economist publication, S’pore will be the 6th best place to be born in, M’sia will be 36th and HK 10th.

Maybe the WP MPs have a point in being so supportive of the PAP govt? Maybe NSP is right that the party is not ready for govt: PAP still going strong?And maybe PM Lee and Chief Clerk Goh ain’t that bad?

I’m surprised that ST didn’t see fit to publicise this. Must be full of subversives.

But this good ranking does raise a question: If so good leh, home come S’poreans are refusing to breed? Shumething must be wrong? Maybe with S’poreans?

Or do the stats leave out things that matter most to S’porean couples that decline to breed or stop at one.

“Dialogue in the Dark (DiD) is a social enterprise that aims to educate the public on the experience of blindness, ” writes MSF S’pore (Kee Chui Chan’s ministry)

Tot it should be appropriated as a description of NatCon.

Now to more serious matters.

PM on Wednesday talked of the need to have a government prepared to plan long-term. Bit rich of him to talk about this given the admitted problems in public housing and public transport that the govt’s policy of bringing in FTs by the container-loads have caused. I mean what were Mah Bow Tan and Raymond Lim doing? They even denied there were problems in public housing and public transport.

And waz the point of long-term planning if the plans are lousy or execution bad? I’ve remarked before that the drive for greater productivity began around the time I started work: in the late 1970s. I’ve retired since then, and still there is a problem about productivity. And in the early 1980s, one LKY was ordering graduate S’porean mothers to breed, lest S’pore depopulates. His son is pleading with S’poreans to have more babies.

Might as well prepare model answers? From the papers coming out from the Institute of Policy Studies (like the one setting out various growth scenarios dependent on the level of immigration) and government ministries (like the one on growth and population by the National Population & Talent Division of the PM’s office), and the articles in the constructive, nation-building ST by its economics correspondent and various senior writers, I will not be surprised if “model” answers will soon be available.

(Even the BBC and BBH, an ad agency, are helping out on the birth rate issue.)

And there will be prizes for the WP MPs who recite these answers perfectly. Yes, yes I know WP will not take part in NatCon, but they regularly support the PAP, after saying they disagree with the govt (instances).

And yesterday, PM highlighted three key goals (OB markers?):

— “a vibrant economy by creating good jobs for everyone, as well as a harmonious society where people can enjoy a balanced and fulfilling life.”

— “a meritocratic system where people succeed based on their effort and contributions, along with special effort to help those who start off with less to do well in school and upgrade at work.”

— “to build a Singapore where citizens belong and feel as one, as well as an open, cosmopolitan city that welcomes foreigners with the skills and talents to help the country succeed.”

Well, well. So 102 FT drivers recruited from China (5% of all SMRT’s drivers) refused to work yesterday, disrupting SMRT bus services. They were not happy about their pay. Happily for commuters using the affected bus services, they agreed to return to work while talks continue.

Whither the FT policy, and LKY’s pride in FTs? Striking was a no-no for workers (except, as I recounted yesterday, when the govt had another agenda). S’porean sheep workers did not strike partly because they were afraid of retribution. Now FTs have led the way and have so far got away with it. They might even get more money. If they do, will locals realise that they too can get away with striking? If immigrants whom LKY respect can strike, why can’t they?

And if S’poreans start striking, will the MNCs move on?

Something for the cabinet, PM and his dad to ponder.

“For they have sown the wind, and they shall reap the whirlwind: it hath no stalk: the bud shall yield no meal: if so be it yield, the strangers shall swallow it up.”

As for SMRT, time to forget about the stock. Management is still dysfunctional, despite having a ex-SAF chief and scholar in charge. Err might even turn into another NOL, where as I have recounted another ex-SAF chief and scholar has run it aground (Search “NOL” on this site).

In a 2010 paper in the journal Tobacco Control, a group of Singapore-based cancer specialists proposed phasing-out tobacco by denying access to tobacco for anyone born from the year 2000 onwards. The researchers said their idea introduced the concept of tobacco-free generations that would “never legally be able to take up the harmful habit of smoking, at any age”

S’pore’s juz the place to introduce it, less draconian than banning youngsters from smoking. We got licences to own cars (COEs) , licences to drive into the city (ERP charges), licences to buy “subsidised” public housing (got to have marriage licences first), and local media journalists need licence to think (juz kidding).

And the govt could introduce the mandatory death penalty for smoking without licences. Shan could justify it on the grounds that smokers are all going to die one day, anyway.

The Economist, a British weekly newspaper, seems to the PAP’s bible*. It believes that pricing is the best way to allocate scare resources and long before the government introduced road pricing, the Economist was advocating it: just like high taxes on petrol (we got this) , permits to drive cars (our COEs), consumption taxes with rebates for poor (GST and rebates) , low rates of corporate and personal income taxes, and no tax on savings (All present and reporting). Oh yes and it believes low fertility rates are bad and that immigration is to be encouraged, screw the social problems.

But even the Economist accepts that there are limits to using prices to allocate resources. It recently wrote:

— People often exclude financial considerations from their most important decisions, from the person they marry to the foster child they adopt. Even some transactions that do involve money are not really about price. Universities in America do not admit students based on who pays the most, for example. Rather, they select students based on complex criteria that include grades, test scores and diversity. Similarly, students choose their university on more than just financial factors.

— Mr Shapley’s and Mr Roth’s Nobel prize illustrates a larger point about economics. Undergraduates often study “utility functions” to learn how people choose alternative consumption baskets in a way that makes them better off. Once they go on to graduate school and then a job, they deal almost exclusively with priced transactions: for wheat, autos or equities.

Yet in countless private and public policy questions, welfare can be improved in ways that do not show up in the price. Mr Roth’s work on public school admissions and kidney donations are an obvious example, but there are countless others. I recall reading that Starbucks had a plan that would let an employee in one store trade jobs with an employee in another so that both could work closer to home. The result would not change either employee’s output or wages, or Starbucks’ profits. Conceivably GDP would fall because the employees would spend less on petrol or bus fare. But provided the swap was voluntary, the welfare of both would without question rise http://www.economist.com/blogs/freeexchange/2012/10/understanding-economics.

Well one hopes that the government too recognises the limitations of using prices to allocate everything. And that bit about “maximising welfare, not GDP”. It’s in the PAP’s bible. Juz read it, not juz Hard Truths which incidentally is derived from this book book.

—

*Where they differ is on democracy and a free media. The Economist is a strong advocate and proponent of both these principles, unlike the PAP. BTW I used to joke that the government doesn’t need high-salaried ministers and civil servants to think up policy. They need to read the Economist. Declaration of interest: the Economist is my favourite source of info and analysis. I like its combi of social liberalism and conservative economics and its style of prose, entertaining, and irrelevant irreverent.

It says things like: “The branding function of philosophy in politics is to give individual conscience a form congruent with group interest, to transform the mathematical necessities of coalitional partisan politics into many millions of separate acts of self-congratulating private virtue. It’s a neat trick. It would be neater still if fewer pundits played along.”

As a retiree, I was getting worried that PM, Tharman and gang had abandoned a Hard Truth that Dr Goh Keng Swee had laid down (and which has served us well, unlike some of Hary’s Hard Truths): Singapore’s exchange rate policy cannot be used as a tool to manage the country’s export competitiveness. It was a Diamond Hard Truth, engraved in granite, that the Singapore dollar is a key macro-economic policy tool to keep inflation under control.

Increasingly based on the comments of forecasters and the central bank’s actions, I had gotten the impression that the exchange rate policy was being used as a tool to manage the country’s export competitiveness.

Until last Friday that is, when the central bank, in a decision that surprised the market, decided not to ease its monetary policy in spite of slowing exports due to a weaker global economy. (The S$ has appreciated since January by 6% against US$.)

And the Trade and Industry Minister Lim Hng Kiang said on Monday, “The [central bank] recognises the need to strike the right balance between ensuring exporters are not unduly hurt by a stronger currency in the short-term, and capping underlying price and cost pressures in the economy. However, the exchange rate cannot be used as a tool to manage Singapore’s export competitiveness.”

Over the longer term, he added, competitiveness could only be achieved through higher productivity and innovation such as creating new products that the market demands. (Ya been hearing this rubbish since the 1980s but the new products and productivity never appear, bit like Godot)

(He could, and should, have added that S’pores exports require imports. Dr Goh used to emphasise that a cheap S$ means export costs go up because the prices of imports used to make the exports goes up. Minister Lim did not make this point. He should have reminded S’poreans of this Hard Truth.)

Mr Lim was responding to a question posed by an economic literate NMP, Tan Su Shan, who is MD of wealth management at DBS Bank. She asked if the central bank would “consider recalibrating its strong Singapore dollar policy and allow the Singapore dollar nominal effective exchange rate to appreciate at a slower pace”.

“The strengthening of the Singapore dollar is a key macro-economic policy tool to keep inflation in check over the medium term,” he added.

Hernan Cheyre, the boss of CORFO, a government body that oversees Start-Up Chile and other initiatives to support entrepreneurs, argues that while Brazil will inevitably be seen as the China of Latin America given its size, Chile can become the region’s Singapore, which has prospered by welcoming foreign talent and providing businesses with a stable, well-regulated base for their operations throughout Asia.

Singapore, however, has a long track record. Start-Up Chile is only two years old, and it is closely identified with the current centre-right government, which may be turfed out at the polls next year.

Yesterday, I read that the government is planning to do more to help the depressed and I remembered that I chanced across this (see below) response to an Economist blog piece on escalating medical costs in the developed world. It suggests (among other suggestions) adding various soluble drugs to the water Americans drink as a way of keeping healthcare costs down: one of the drugs is Prozac which is a drug that helps control mild clinical depression. Other drugs suggested are statins and aspirin.

Now that VivianB (a MD) is water minister, he may want to help out the Health minister. These measures seem to be in line with S’pore’s policy of spending as little as possible on health (around 4% of GDP) without upsetting economic efficiency or upsetting the masses compared say to Switzerland (around 8%). And we already drink recycled water. LOL.

Seriously I hope the SDP looks into these suggestions. SDP has a very gd team of doctors helping out. (BTW what do these MDs have to say about:

(Note writer below is talking of the US, where fluoride is already added to the water they drink. Always wondered why this doesn’t happen here.)

America comes up short in international comparisons of health statistics principally because life expectancy lags despite the highest spending for healthcare. For less than one dollar per capita , I propose Ten Inexpensive Health Interventions WILL Improve Health Outcomes. These will lengthen life expectancy, improve health, increase happiness and decrease dysfunctional behaviors.

We already fluoridate the water to prevent dental caries. And chlorinate to reduce bacteria. We can use the water supply as a medication distribution network by introducing very tiny or trace amounts of medicines that have been known to reduce major diseases.

1.) Simple cheap ASPIRIN dramatically cuts rates of Strokes, Heart Disease and now recently proven in a longitudinal study, reduces Cancer death rates by 20%! Put ASA in the water supply–if would be cheaper than fluoride.

2.) Put STATIN drugs in the water supply. Heart disease and stokes are declining for the first time in history. And it is despite the epidemics in Diabetes and Obesity. It is due to widespread use of effective anticholesterol drugs known as ‘statins.’ ie. Lipitor. High cholesterol is endemic and contributes to strokes and heart attacks. Just about everyone benefits from lower cholesterol.

3.) Water Born Oral VACCINES. Up to 30% of parents do NOT believe in the value of vaccinations and many act on this belief. Utilize water borne vaccinations in the water supply, such as the oral polio Sabin Vaccine. Put Folate in H20 to prevent neural tube defects in fetuses.

4.) PROZAC to decrease Dysfunctional Behaviors and improve Mental Health. Far more common than crime is non-criminal personal dysfunctions. Up to 40% of Americans will experience a diagnosable mental illness in their lifetime including Depression, Alcohol abuse, illicit Drug abuse, Anxiety disorder, PTSD, Obsession-Compulsion, Eating disorders. Half of these will remain undiagnosed. And love ones suffer by enduring the mental ill relative like an affliction. Virtually all these maladies would benefit from Prozac type drugs which increase brain serotonin neurotransmitter. It is a vital tool in psychiatry: ‘Vitamin P’. Put Prozac in the water supply and we will be less sad, less depressed and less dysfunctional. It will shrink dysfunctional behaviors, criminal behaviors, afflictions and addictions. It would save BILLIONS in the Criminal Justice System. Lead to more productive fulfilled citizens who are happier. Less alcohol and drug addictions. Less DUI, trauma and killing sprees.

5.) Perhaps an effective future drug to treat or prevent Diabetes or Obesity–put it in the water. We have a new Epidemic of Obesity never before seen in the history of civilization. All interventions have been stymied to reverse the epidemic. We have to be creative about how to address this problem. The water supply is a simple and effective vector that treats the entire population. Observe the effectiveness of fluoridation on cavities for pennies per capita per year.

6.) Ban Tobacco Products, the leading Preventable cause cancer deaths, heart attacks and strokes. It would cost nothing in health care but would literally overnight vault the US life expectancy over the #1. Japan.

7.) Restrict television broadcasts to 2 hours a night of quality programming from 8 pm to 10 pm. We get 24 hours of 1000 channels–98% is garbage programming. It would force Americans to find other more healthy forms of recreation like walking, exercising, reading and even talking with each other. We undersleep and spend 4-6 hours of waking hours watching TV.

8.) Make Supermarkets reflect a Vegetarian Diet. 80% of floor space for Produce. 10% for dairy. 10% for the meat department. Vegetarians live longer and are more active. We have to make it easier and more desirable to enjoy vegetables Likewise encourage walking, exercise, and activity.

9.) Tax Alcohol extremely regressively to the point that consumers have to hurt to make a purchase. They will value that little sip of brandy or Chardonnay even more. Make bottles much smaller at around 100 ml. Like a Coca Cola at the turn of the century: medical tonic amounts. Yes people can drink, but moderation(less than two drinks) is best.

10.) Milk-Based Nutrition/ Beverages. To increase calcium in young persons, make all flavored beverages and hydration drinks MILK BASED. A milk based Coca Cola. We will see taller, more active, healthier citizens. Perhaps the best way to combat osteoporosis in the elderly is fortifying bones in teen age girls. And using high impact sports like simple rope jumping. This will make a difference in the wide spread osteoporosis of the elderly. Your skeleton will thank you decades later.

This is a radically different way of thinking about Public Health, Medicine and Wellness.

Desperate Times Call For Desperate Measures.

Make Public Health medication an automatic feature by incorporating it into normal plumbing.

Let people OPT-OUT by buying their own water and we will have 95% participation.

We now have an OPT-IN system for medicine that is not working.

Healthcare delivery is a complex problem requiring smart solutions, but sometimes solutions can be as simple as fluoridating water. We need a Fluoridation System for the 21st Century.

PAPpies will agree that these three quotes apply to the masses but that the second one doesn’t apply to ministers, the senior civil servants or senior GLC executives.

“Senior management’s job is to pay people. If they fuck a hundred guys out of a hundred grand each, that’s ten million more for them. They have four categories: happy, satisfied, dissatisfied, disgusted. If they hit happy, they’ve screwed up: they never want you happy. On the other hand, they don’t want you so disgusted you quit. The sweet spot is somewhere between dissatisfied and disgusted.” Greg Lippman, banker, quoted in The Big Short by Michael Lewis (2010)

“Currencies fluctuate; commodity prices fluctuate. Why should we expect earnings to rise in a straight line upward?” William Shenkir, academic

An article in SunT ST last week on farming on the rooftops of HK reminded me that I had written in My S’pore: A greener & more pleasant land about using the roofs of our HDB blocks and other high-rise buildings to create a greener S’pore using examples from Switzerland. I also added, “This being S’pore, we could use HDB roof-tops to be self-sufficient in basic veggies, and range-free eggs.”

Well not only are the Hongkies now farming on the top of high rises, but I have since learnt that the Americans were already doing it for some yrs now: The idea to grow more food within city limits has spread in recent years along with increased awareness about the quality of our food and where it comes from. Advocates say urban farms can also provide important green-space and, when built on roofs, help reduce energy use and storm-water runoff. In dense cities like New York, with high real estate prices, rooftops represent enticing, unused space. Several cities, including New York and Seattle have revised zoning and building codes to help encourage the practice.

Many have castigated (self included) the ruling PAP for being mean to S’poreans despite its our money that it refused to spend. Things are changing as I’ve been blogging recently (example), even if others don’t appreciate or notice it.

But here’s shumething to reflect on from a blog of PAP’s favourite “running dog” int’l publication (it advocates things like CoEs and road-pricing and GST and low corporate taxes): Here lies a problem that has dogged nations all through this crisis (and still dogs nations outside the euro zone like Britain and America). The collapse of tax revenues in 2008 and 2009 caused deficits to soar, and made public finances look unsustainable. But when you start from a very large fiscal deficit, it is hard to get back to balance. Do it too quickly and you squeeze the economy too hard; do it too slowly and the markets may not finance you. I am not aware that Keynes dealt with this problem (although I’m happy to stand corrected, if anyone has chapter and verse). Of course, the best answer is growth (a consummation devoutly to be wished) but we are very good at talking about it, and a lot less good at producing it.

The PAP avoids fiscal deficits. So taz one problem we don’t have. But look out for my Monday piece on the problems that the government created for the economy. Not me but from DBS Bank.

No, I’m not talking abt what Uncle Leong pointed out about the growth in FTs despite all the talk of by the government of it being curtailed. The analysis and comments of Uncle Leong and many others based on the government’s very own data has resulted in this attempt via originally new media (then amplified by the constructive, nation-building media) at damage control.

And let’s ignore what rogue scholar, TJS, has somewhere analysed*: that it’s not true declining population lead to economic ruin. He is after all, as Lawrence Wong, would put it “anti-PAP”. And he could even, at a stretch, be classified as one of Sim Ann’s demons who “spew hate and prejudice against individuals or groups”. Remember, he bitched against bungalow owning ministers, when, I’m told, he too has a bungalow.

No: My complaint is why don’t we get told how well Japan is doing?

A country has three choices when its TFR (total fertility rate) drops Get the TFR back up; encourage immigration; and do nothing i.e. let the population age.

Most countries try to increase TFR, some succeed. Japan tried it, failed and as it doesn’t do immigration, it prefers to use robots, it is managing the decline in population.

Japan has shown, a country with a declining population can still do better than other developed countries as figures from HSBC (published earlier this year) show which contradict the doom and gloom that one LKY says abt Japan.

Growth per capita in the 2001-2010 decade

Japan 1.6%

UK 1.2%

Germany 0.8%

US 0.7%

France 0.6%

And looking at the overall GDP numbers, Japan’s record is as good as that of the Germans, who now have created the Fourth Reich in Europe.

US 1.6%

UK 1.5%

France 1.2%

Germany 0.8%

Japan 0.8%

So the Japanese have well, considering their aging and declining population. Perhaps our PM should be listening to them, and trying to take some tips, especially on the use of robots (say to replace Lawrence Wong and Sim Ann who seem to be stuck with some PAP robotic messages that are a throwback to when LKY ruled the roost). And get dad to stop talking rot on Japan.

As to the need of the elderly population needing younger S’poreans to pay taxes to keep the place going, that both PM and Tharman mumble about, ain’t the governing PAP forgetting that it instituted the CPF system precisely to avoid a “Pay as You Go” social security system. (OK, OK, I’m unfair on the PAP on this but two can play the BS game.)

It’s you die, if you got no CPF (Don’t look to VivianB for help. He will only sneer at you for being poor) So by the PAP’s own account, the elderly (like me) don’t need a growing and younger workforce to support.

So Minister, although you are a Hindoo, somehow I think this verse from the bible is applicable to you (and your fellow ministers) when it comes to having an “honest conversation” about FTs:

Either how canst thou say to thy brother, Brother, let me pull out the mote that is in thine eye, when thou thyself beholdest not the beam that is in thine own eye? Thou hypocrite, cast out first the beam out of thine own eye, and then shalt thou see clearly to pull out the mote that is in thy brother’s eye.

—–

*Sorry no link as I’m not too impressed by his analysis. He left out that his favourite Nordic countries tax its people too much for my taste.

[M]odern states have tended to extend benefits to the better-off, partly because of lobbying and partly as a way of buying the support of the wealthy for the welfare state. All this is well illustrated in Suzanne Mettler’s book “The Submerged State”, which shows how these hidden subsidies can distort voters’ view of the way that government policy works; a 2008 poll found that 57% of Americans denied ever using a government programme. But when shown a list of 21 actual programmes, including student loans and home-mortgage interest deduction, 94% of the deniers turned out to have benefited after all.

[Would be interesting if TJS’s research centre could do something on whether the middle class benefits from govt subsidies: could kill the PAPpies pt abt housing and education subsidies]

Universal benefits are very expensive. But targeting benefits requires means-testing, an instrusive process that causes hard cases at the margin. And restricting benefits to the poorest may weaken political support for the whole system, along the lines highlighted by Mr Romney; people may believe that the hard-working “us” are subsidising the feckless “them”.

The rising inequality of incomes mean that even moderately well-off people do not feel that rich; not least because the elite have driven up property prices in desirable areas … to levels that those not working in the finance sector cannot afford. Meanwhile, the very elite can insulate themselves from everyday life. Think of the experience of the average first, or business, class air passenger. They sit in a different lounge from the other passengers, enter the jetway through a different door, sometimes enter the plane through a different door as well, sit in a curtained-off section and then leave the plane before everyone else. They could make an entire transatlantic flight without coming into contact with the hoi polloi.

The problem is that the political elite tend to mix with the financial elite … and, for security reasons, also have to cut themselves off from the average voter. So it may be doubly hard for them to understand the pressures of those who are actually on median incomes.

(Or “LKY has repented? No we got him wrong” or “LKY, no FT lover, no hater of locals”)

I came across this about a month ago, but didn’t comment, waiting to see if anyone other self had picked it up No blogger did, and I forget abt my plans to blog on it until a few days ago.

“If we go on like that, this place will fold up, because there’ll be no original citizens left to form the majority, and we cannot have new citizens, new PRs to settle our social ethos, our social spirit, our social norms …
accept migrants at the rate at which we can assimilate them and make them conform to our values, ” LKY.

I was stunned and shocked to hear him talk of wanting “original citizens” (who he said need spurring ’cause they are less hard-working than his beloved FTs) “to form the majority”, and that his beloved FTs (“new citizens, new PRs’) cannot and should not “settle our social ethos, our social spirit, our social norms”.

I had tot he wanted S’pore to be over-run with FTs because he was liked the solution proposed (ironically) in this poem

After the uprising of the 17th of June

The Secretary of the Writers Union

Had leaflets distributed …

Stating that the people

Had thrown away the confidence of the government

And could win it back only

By redoubled efforts. Would it not be easier

In that case for the government

To dissolve the people

And elect another?

(The writer, Bertolt Brecht, was a famous playwright, a Hollywood screen writer in the golden years of Hollywood in the 1930s) and a Marxist activist.)

What next from him? Malays are loyal to S’pore?

A few days ago, I was reminded of the above remark when I read this from a PAP apologist from the top of our constructive, nation-building ST: seems as far back as 1971, LKY has been concerned abt FTs over-running S’pore. If so how come his acolyte Wong Kan Seng when he was head of Home Team allowed PRC hawkers, a slutty looking, violent, cheating shop assistant, and an ang moh awaiting trial for beating up a S’porean PR status? Or that the government from the late 1990s onwards imported FTs by the cattle truck load.

Well the piece fooled many thinking S’poreans. S’poreans who saw it as vindication that even a worm like a true blue ST man can turn on a PAP policy i.e. ST is changing for the better. I had no such tots. I focused on the dates when LKY said:

— “And if you take too many, then instead of our values being superimposed on them, they will bring us down to their values because it’s easier to be untidy, scruffy, dirty, anti-social than to be disciplined, well-behaved and a good citizen.” (1971)

— “There will be cultural, linguistic, social and political problems. /Well, those cultural, linguistic, social and political problems have now come to roost, 40 years on.” (1978).

Err, these were the two examples quoted in 1971 and 1978. Then we have to jump to to August 2012 for the third one which I quoted above. Nothing in between?

A cynic could conclude that there is some rewriting of history, that despite all his praise of FTs and denigrating locals, and the pro FT policies, LKY cared about S’poreans being swarmed by FTs, and that he expressed this in 1971 and 1978.

Possible motives:

— To correct the perception (or is it misperception?) that LKY prefers FTs to S’poreans in S’poreans. The aim is to protect his legacy as one of the founders of modern S’pore. Bit difficult to have an icon of S’pore who prefers FTs to locals, even if he did a lot for S’poreans, which he did, and all but the likes of KennethJ and Dr Chee would agree he did.

— Another could be to show that when he was in charge, he had different views on the role of FTs then Goh Chok Tong or his son.

The spin doctors have to do better. They had better look for statements post 1978 but pre August 2012, expressing the view S’poreans should not be swamped by FTs. LKY was PM until 1990, and S’poreans believe that until recently, he had the final say on any important policy. And then there are all the pro-FT statements. And those denigrating locals.

Whatever it is, join me in a belated birthday greeting to LKY. The team that he headed in the 60s, 70s and 80s, and S’poreans made S’pore a developed world city. Too bad abt the team in the 90s and noughties, of which he was a part. And the son’s doing a decent job of correcting the mistakes of the 90s and noughties (despite being a leading player in the mistakes). But I wish he hadn’t started NatCon.

BTW, I taking up the challenge of compiling a list of things that the WP did not do in response to a challenge from a WP groupie upset with last Fri’s piece. Looking for sponsors to fund it (No peanuts pls). Or for help to draw up the list. Against my principles to do anything for free for the PAP, who always say, “No free lunch”. But who have a freebie via the PA, widely perceived as an arm of the PAP, even if it is tax-payer funded.

Two quotes from Dale Carnegie’s How to Win Friends and Influence People, that could teach PM, Heng, Sim Ann and other ministers a trick or two:

— “No one likes to feel that he or she is being sold something or told to do a thing. We much prefer to feel that we are buying of our own accord or acting on our own ideas. We like to be consulted about our wishes, our wants, our thoughts.” (Actually Auntie Sun’s hubby, pastor Kong, could teach them this, what with his Sentosa Cove penthse to prove it. But PAPpies prefer to learn from FTs.)

— “The only way on earth to influence other people is to talk about what they want and show them how to get it.”

The second quote explains why PM’s dad (and a hero, flawed, of mine) was successful in getting S’poreans to vote for him and the PAP despite his bullying, thuggish ways.

He spoke to S’poreans of his and older generations what they wanted to hear: “A better life for yrself and yr family.”

And how to achieve it: “Vote for the PAP and accept my policies be they throwing dissidents into prison without trial (anyway they are commies who want to steal yr money or work you to death), and have union leaders like Devan Nair who are my running dogs, and accept my lectures, hectoring, thuggery and bullying.”

He got the message right* and delivered the prosperity bit (whether or not the prosperity was the result of his** policies and methods is open to debate***) for most elderly S’poreans. True, there are some elderly S’poreans who missed the prosperity (and who now need to be helped), but in general, many are reasonably well-off, especially if they suffer from severe illnesses. I’ve relations much older or juz slightly older who have benefited from the then HDB housing policies of the 70s and 80s. And who are benefitting from the present healthcare system.

(One said during the Chinese New Year, “We were poor when we were young. Thank the Lord (her family are Christians) that in our old age we are comfortable. Nothing worse than being poor when old.”)

They are the first to admit it, their children and grandchildren are not finding life that easy. But hey LKY’s only a mortal, even if at times the constructive, nation-building media, esp ST, portrayed him as a demigod.

———————–

*And he is a genius when it comes to marketing “Authentic marketing is not the art of selling what you make but knowing what to make.” Philip Kotler, academic (1931–), Marketing Management (1967)

The problem. is that since the late 1980s or early 1990s, the PAP wants S’poreans to do want the PAP wants them to do; but it is unwilling (and unable) to promise S’poreans material prosperity in return. It is only willing to say,”We will try to help you achieve material prosperity. But we still want yr soul.”

The governing PAP used gimmicks, like asset enhancement inflation and indiscriminate importing of , that have backfired on the PAP because of their negative consequences, intended or otherwise, on S’poreans.

**And don’t forget the role that Dr Goh Keng Swee, Lim Kim San, Hon Sui Sen and Ngiam Tong Dow played in the economic policies. They wisely left the bullying, lecturing hectoring and thuggishness to LKY.

***Remember that in the 1960s and 1970s, S’pore was one of the few places (HK was another) that welcomed MNCs to set-up factories. MNCs were looked upon as a form of neo-colonialism by most of the developing world. Today, every developing country wants MNCs to set-up factories. So credit must be given to the PAP for this policy. But as we know, this policy resulted in the lack of home-grown companies like Foxcomm and HTC in Taiwan and Samsung in Korea. But breeding these cos led to problems in these countries.

Shumething I came across on Facebook: To be frank, I think the default is now, “Why should we listen to the government?” and we should all realise that they’re listening more and we’re listening less. Old knee-jerk political reflexes are not useful anymore. We need to be clear-minded and work on both qualitative and quantitative data and input, not just the same old stories on all sides.

He is spot-on.

Then this: “S’poreans [are] urged to share and listen with open minds and hearts” said Education Minister Heng Swee Keat who “is heartened by the many conversations that are going on about the national conversation and follows them with great interest.” Mr Heng had been tasked by Prime Minister Lee Hsien Loong to lead a team of younger ministers to engage Singaporeans in a national conversation about the country’s future direction.

The conversation, to be meaningful, must include the issue of public access to govt data bases. This explains why it should give access: In knowledge discovery in datasets, the major barrier to entry is access to the data. When corporations, governments or other private firms jealously guard their proprietary data, the number of people playing with the data and trying to discover valuable things, or putting that data to good use, will remain small. When data is made public, anyone can put that data to work. In recent years governments have begun making large troves of their data publically accessible. The U.S. government’s open-data project, data.gov, for example, has begotten over 200 citizen-developed apps. Similarly, the city of Vancouver, an early mover in the municipal open-data space, opened up their data in 2009, spawningvaluable mashups of transit data, the water grid, and common spaces.

Finally, the calls by some netizens for a debate rather than conversation are misguided. Debates are by their nature rigid. The emphasis is on point scoring. This format suits the government. So better to keep it at the conversational level.

— Pledged to ensure sufficient affordable housing for citizens, and built more nursing homes for the elderly.

— Said the government will decide on measures to encourage Singaporeans to marry and have more children after consulting the public. Areas being considered include better work- life balance, flexible work arrangements, priority housing for couples with young kids, paternity or shared maternity leave, defraying childhood medical expenses, better pre-school, childcare and infant care, and improving cash benefits for having children known as baby bonuses, he said.

— Pledged Singapore will have two more universities to increase educational opportunities and the government will invest S$60 billion over ten years on the island’s subway system. Bloomberg report.

What this means is that the government is finally going to spend our money on us. No more of his dad’s “frugality”* on spending S’poreans money on S’poreans.

He is saying, “It’s yr money, let’s spend it on making you happier”.

To reinforce the point, he implicitly promised that there would be no near time tax rises, saying (correctly) that Singapore will need to raise taxes in the next two decades (but not now) as the government boosts social spending to support an aging population.

In the past ministers like Tharman and Raymond Lim (remember him?) threatened to raise GST whenever S’poreans asked for more govt spending.

So netizens, give the PM more rope to hang himself or show us that things are a’changing. The assumptions and prejudices of the PAP remain (see here) but at least he is spending our money on things that we want or need to make life more comfortable.

For that let’s give him two cheers. Give him a third if he rethinks the aforesaid prejudices and assumptions inherited from dad.

—

*An economist lecturing at SMU once commented (when LKY was MM and in rude health) that LKY would die if the government spent a cent more than absolutely necessary on making life more comfortable for S’poreans. Having read his daughter’s comments on his wanting Mrs Lee to change the elastic band on his underwear when she was recovering from her stroke, I think the economist had a valid point, and wasn’t joking.

So the PM in yesterday’s speech promised that the government will play a more active role in pre-school education to help S’poreans “level up”*. Actually it already has a very active role**.

Ever since the Lien Foundation came out with its report earlier this yr which in its media released stated, “Singapore’s preschool education placed 29th amongst 45 countries on the Starting Well Index” and reported that South Korea (10th) and Hong Kong (19th) were ahead of us,there has been the usual hot air from the government, the constructive, nation-building media, and S’poreans, largely off-line via the media***.

One issue that all three groups skated around are the two elephants in the ice-rink: the PAP Community Foundation (PCF) which is the dominant provider of kindergartens in S’pore, and its smaller cousin NTUC; and the ring-master (the governing PAP). Remember that the NTUC and PCF are “teeth” to the lips of the governing PAP.

It’s not surprising that the government and its minion, the media, avoided talking abt the role of the PCF and NTUC (until last night) and the government in the failure of kindergarten education here (PM skated over why the system needed fixing). So let me lay it out thickly.

The report says that where S’pore falls short is on quality issues: “Most of Singapore’s weaknesses showed up in the area of‘quality’, which includes factors like ‘student-­‐teacher ratio’,‘average preschool teacher wages’, ‘preschool teacher training’and ‘linkages between preschool and primary school’. All top ten countries on the Index have ratios ranging from one teacher to five to 11 children, compared to Singapore’s 1:20 ratio.”

It’s a question of funding.

While the NTUC and PCF cannot be blamed for the lack of funding because they are, unlike private kindergartens serving the moneyed, trying to serve the masses, not the children of elite, middle class bloggers: they can be blamed for not lobbying the government for more money to rectify ‘student‐teacher ratio’,‘average preschool teacher wages’, and ‘preschool teacher training’.

So until the government increases its funding (which the PM now has), the children of S’pore’s masses will continue suffering from low quality kindergarten education.

We know that Tharman as finance minister has failed to control inflation (Yes, yes, I know latest number is 4% but remember grain prices are flying), when all he can do is to make jokes about it, and that the government (where he is now the senior most minister in charge of the economy) has consistently failed to raise the productivity of S’pore workers* despite talking the talking on this since I started working in the late 1970s. I’m now a man of leisure and the government is still talking about raising productivity. SIGH.

I was reminded of another failure of the government’s economic policies when the July export data came out last week. No it wasn’t the failure of the government policy to diversify away from electronics. If S’pore has a comparative edge here, so be it.

No, it was the failure many yrs ago to realise that pill-making is not a steady business. Example: in July, while pharmaceutical shipments were up 1.3% after rocketing 24% in June. It was brought in to smooth the volatility of an economy dependent on the export of electronics, a volatile commodity.

It didn’t work because while selling drugs is a steady business in gd times and bad (unlike electronics), making pills is not. It’s a very volatile business. Drug cos are forever tweaking their supply chains to minimise production costs and inventories. Production is not smooth.

So while pill-making has become an important driver of economic growth, it has not made the economy any less volatile. In fact combining it with the manufacturing and export of electronics causes the economy to gyrate wildly at times.

Guess who introduced pill-making? One Lee Hsien Loong. He was once responsible for raising the productivity of S’porean workers? In the UK, a Chancellor of the Exchequer, who goofed on two major policy decisions, would not get to be PM.

Looks like better not bet against Tharman being PM. With the failures on inflation, productivity and the following on his CV, nap that he will become PM:

— Another failure is the rise in the number for homeless S’poreans at a time of reasonably gd economic growth.

— They are exemplars of the “working poor”, something articulated so well here. Read it.

Yet casinos are still expanding in Macau despite not having cheap FTs as croupiers and dealers.

Must have lessons for S’pore?

[I]t’s a world where young people like Tommy hold all the cards. With the law favouring local workers, jobs are handed to the polytechnic’s graduates on a plate. Many receive offers of employment from casinos long before they finish their courses.

When SVB Financial Group’s banking unit Silicon Valley Bank opens a branch or office or j/v here, we will know that S’pore has made it into the Silicon Valley ecosystem. It has juz opened its first int’l branch: in London. It will target Britain’s technology, life science, private equity and venture capital sectors

Silicon Valley Bank counts Cisco Systems, Mozilla and Pinterest, among its US clients.

Silicon Valley Bank also has offices in Israel, India and is expected to open a joint venture bank in China with Shanghai Pundong Development Bank.

When it comes to town, bang balls KennethJ, TJS, TRE, TOC, E-Jay, SDP etc. But don’t worry guys, it’ll be a long time, if ever, before the PAP government’s rhetoric becomes a reality*. In tomorrow’s post, I’ll link to stories which show how competitive Vietnam is becoming in software development to places like India, and that even Cambodia, with an American’s help, can use the internet get into a global biz competing with China and India.

—

*I mean juz see the BS around the comment made on LSD use, and on sex between adults juz because they are not married. So intolerant.

The issue of changing the rules on the access to our CPF funds is one that upsets many S’poreans, even those who support the PAP. The imposition of Minimum Sum and CPF Life are lazy solutions to a problem that needs to be addressed: longevity.

But while we should, disagree and row with him on the access to our money, we should not be in denial that we (me excluded) have to retire only in the 60s. The issue is longevity, not the amounts we have in our CPF accounts and how the cost of housing erodes the amounts left over for retirement, or access to our money.

There are problems: rising inequality, persistent low productivity (despite all the govmin talk and campaigns), lack of local entrepeneurs complacent BSing ministers, and bad public transport. But taz not the same as saying that S’pore is an economic disaster like Bangladesh.

(Or “Why group feeling is so impt” or “How times have changed since the late 70s (Worth of being a S’porean)”)

Reading the u/m, I was reminded that Ngiam Tong Dow (Sparta, Athens and the Chinese imperial exam system) and the PAP (George Yeo and his mis-readings of history, one being why Venice did better than Genoa*) have used history to preach to S’poreans

First was the widening gulf between the social classes, rich and poor. When rich and poor start to live completely different lives this leads (then as now) to the poor opting out of the state. All studies today show that society is happier when the gap between rich and poor is reduced …

Widen it and you affect the group ethos of society, and also the ability to get things done through tax.

In the Roman West real wealth lay more in land and property than in finance (though there were banks) – but in the 300s the big land-owning aristocrats who often had fantastic wealth, contributed much less money than they had in the past to defence and government.

That in turn led as it has today to a “credibility gap” between ordinary people and the bureaucrats and rich people at the top.

Other strands in the collapse of the Roman West are more difficult to quantify, but they centre on “group feeling”, the glue that keeps society working together towards common goals. Lose that and you get a kind of nervous breakdown in the social order, which leads to what archaeologists call “systems collapse”.

The growing inequality in S’pore society we know and bitch about, but the loss of “group feeling” is shumething “we see through a glass, darkly”. We sense it but we have problems articulating this loss of group feeling. Symptoms of it are often ascribed as the problem. Examples: The

— unhappinness that male FTs (like PAP MP Puthu) have a free ride here because they don’t have to do NS;

— resentment against the PAP government because it appears to elevate FTs to a higher status than locals;

— resentment against one LKY who called S’poreans “daft”, who needed to be “spurred”,

are symptoms of this loss of group feeling, not the problems themselves.

The government is largely to blame for this loss of group feeling thru its strategy of keeping the economy growing by using FTs to keep wage costs down because otherwise the strong S$ would make S’pore an uncompetitive economy. Its asset enhancement policy and forcing S’poreans to leverage to their foreheads to buy property, has it made it impossible for S’pore to have low economic growth without triggering serious problems for the PAP and S’poreans. Imagine all HDB owners having -ve equity on their flats?

The sad, funny thing is that the PAP government fostered the sense of collective identity through schemes like NS to strenthen its grip on power after S’pore was ejected from M’sia. Older S’poreans like me can remember the days when the government told us that we S’poreans were special, compared to the Indons and M’sians. Look at the M’sian and Indon Chinese trying to get in. Today, according to the then PM, S’poreans are “daft”, and need “spurring” (or is it to be “spurred”?).

Oh and as the extract showed, “group feeling” is linked to wealth inequality. The bigger the gap, the less “group feeling”.

—————

*Actually, I’m surprised that he didn’t put in down to the Venetians having a more authoritarian form of republic with power centralised in the doge). A rebuttal.

Ah so, so selling one’s soul is pointless. The person who leaked the WP’s minutes of meeting which showed that Png had misrepresented when he said he had removed his name from the ballot must be banging his balls in frustration. Png and WP cocked-up in the handling of DPM’s Teo comments abt Png, but thaz abt all. I doubt this would affect the voters views, even though the constructive, nation-building media (see today’s ST) is bitching about “dishonesty”, being more PAP than DPM Teo.

I have a shrewd guess on who leaked it. His hatred of Low has perverted the character of a decent, fair chap, turning him into a “I hate Low” zombie. I wish him a speedy recovery from his fixation.

On a separate issue, what I found most interesting abt the minutes was that it showed that Eric Tan had decent support for his bid to be NCMP but that GG had more votes. So Eric had supporters on the central executive council who appreciated his hard work and wanted to recognise his efforts. And not all the WP CEC members are cold, rational, calculating machines (Let’s face it, even as Eric’s friend, I think that giving the post to GG was in WP’s long-term interest, and still do despite GG’s “C-” performance in parly), or Low’s acolytes.

Back to Png and WP. WP has “malfunctioned” again, despite, or because of, having three lawyers as MPs. I hope the WP starts repairing and oiling its machine ASAP before something serious happens like getting disqualified in an election (2001). Both in the handling of YawGate and PngGate it made silly, avoidable mistakes. WP needs to get the machine to function as it did in 2006 (Garbra Gomez’s antics notwithstanding: BTW he took responsibility for the 2001 mess-up) and 2011 GEs.

Update

Nice to hear that Eric Tan has confirmed that Png told him before meeting that he didn’t want NCMP post.

“Prime Minister Lee Hsien Loong has said the Hougang by-election should not distract the country from focusing on national priorities and building an inclusive Singapore,” CNA reports.

Either this is the latest of PM’s tasteless jokes in his attempt to outdo Tharman as the cabinet’s and PAP’s mgt committee’s stand-up comic, or it shows us that he doesn’t even bother to glance thru the nation-building constructive local media.

Because if he does, he would realise that “national priorities and building an inclusive Singapore” are at the top of most voters’ concerns: the state of the economy and public transport infrastructure, and of family finances. Examples:

— a MRT system that does not breakdown almost every other day,

— less crowded trains and buses,

— lower inflation (even the crown prince of jokers says the latest inflation number is “a high figure” though he quickly quipped that it didn’t affect most of us “lesser mortals” (my words not his),

— how to earn more money,

— how to afford to own a HDB flat on $2,000 a month,

— how to buy a van (what with escalating COE prices), or

— worrying that ”Our system of integration doesn’t work. Why? Because before we were able to integrate those who were received on our territory, others arrived. Having taken in too many people, we paralysed our system of integration.”

A worrying tot has juz struck me. What if his (and the PAP’s) “national priorities and building an inclusive Singapore” are different from us “lesser mortals”? He wants faster economic growth via becoming a low-cost producer as “national priorities”, while “building an inclusive Singapore” means treating FTs better than locals?

Remember a few days ago I ranted abt the comment by DPM Teo* that, “Singapore needs to pay extra attention to facilitating the new immigrants who are ready to sink roots here, so that they integrate into society more quickly … urged Singaporeans to do their part to make newcomers feel welcome, and to help them imbibe the values that have made Singapore strong as a society”? It was the fault of the governing PAP, so it should fix it, not pass it on to us.

Well this morning, while scanning thru BBC Online, the following comment by France’s president leapt at me, “Our system of integration doesn’t work. Why? Because before we were able to integrate those who were received on our territory, others arrived. Having taken in too many people, we paralysed our system of integration.”

In view of DPM’s Teo passing-the-parcel, our problematic MRT system, crowded buses, and expensive public housing one could say that his words describe what has happened here.

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*I think he is one of our “betterest” ministers along with Tharman, Khaw and VivianB (so long as you keep him away from the poor and needy and give him engineering tasks). Gan, Chan and Tan seem to be coming along nicely.

Japan has agreed to write off more than US$3.7bn of debt owed by Burma and to resume development aid. The leaders of both countries also agreed to plan a special economic zone near Rangoon. This could give Japanese firms a head start in winning business in what is seen as one of Asia’s last frontier markets.

Hey could have been S’pore planing a SEZ with Burma! We are “old friends” of Burma. And GLCs and TLCs got experience of building biz parks in Vietnam and China. Come on Georgie Boy. Go broke deals between S’porean cos and Burmese ones and the government. Too comfortable, what with big fat pension? Or planning to reform PAP? Or planning to be president?

(Ya aware that three postings in row abt Northern ASEAN countries. But taz where the biz and investment opportunities are coming from in this region.)

As I wrote in Part I, because Professor Lim Chong Yah’s “shock therapy” proposal is a variation of what was implemented the early 1980s (until the 1985 recession: neutral article on the recession and one blaming it on the original “shock therapy”), when one Ngiam Tong Dow* was Permanent Secretary in the Ministry of Trade and Industry, I thought it would be interesting to reread a speech Ngiam made in March because MTI had once upon a time analysed the problem of severe manpower shortages and the economy’s increasing reliance on lowly paid foreign workers. Its solution was to restructure the economy by raising wages substantially to dampen employers’ demand for lowly paid workers, what Professor Lim is recommending.)

The speech is long and can be broken down into a sociopolitical analysis of S’pore, and an economic analysis of S’pore.

This post reports and comments on the sociopolitical aspect of his speech**. In Part I, I did the same on the economic part of the speech.

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Colonial system

Although this appears in mid-speech, it’s a good introduction to his sociopolitical thoughts.

“When Sir Stamford Raffles founded Singapore in 1819, his town planner demarcated the town into several ethnic enclaves. Kampong Glam (Malays/Arabs), Chinatown (Hokkiens, Cantonese, Teochews), Little India (Tamils), and Tanglin (Europeans). Empress Place on the left bank at the mouth of Singapore River was the administrative and civic centre. The British governor presided from the Istana … Each racial group was free to conduct their own trades, practice their own religions, set up their own schools, and largely married within their own race and ethnic group. The colonial government provided the overarching framework of law and order and schooling in the English medium.

‘Being a British colony, the language of administration was English. Access to English medium schools was open to all races. English became the lingua franca acceptable to all the races as none has any
in-built advantage over the other.”

Differences in the body politic

He talked of the difference between his generation of undergraduates at the then University of Malaya (NUS today) and those of today, “Except for the few activists of the University Socialist Club, my contemporaries at university were politically passive but not naive. In the political environment … we thought it prudent to keep our thoughts to ourselves.”

(So they were not sheep, just cautious, crafty mouse-deer of Malayan folklore?)

But “NUS undergraduates today are more articulate. They have courage of their own convictions,expressing their views vigorously at tutorials or the cafeteria.” (But are they wiser than Ngiam and his contemporaries, or just more noisy? “Remember “Still waters run deep” and “Empty vessels make the most noise”.)

He pointed out that the PM “has to deal with an electorate that is vastly different from … his father’s generation”. “The command politics of his father no longer works … PM has … to appeal to reason”. What surprised me was his comment that Lee Kuan Yew “appealed to emotions”. What I respect abt LKY’s speeches from that era are their simplicity and internal logic.

Uniquely S’porean

“[C]an Singapore be considered a democratic state?”. His answer was it can’t. “We are not a theocratic state like the Vatican or present day Iran. We are … not ideological states like North Korea, Cuba or China.”

He compared the western concept of democracy (“government of the people, by the people, for the people”) with that of the Chinese imperial system, “China’s emperors had to gain the consent of the people to earn the mandate of heaven to rule.” He seems to imply they are somewhat similar.

A difference is that losing heaven’s mandate often involved some form of violence. Mind you, in places like Nigeria, Kenya, the Philippines, Thailand, Bangladesh and India, democracy often involves violence.

He went on to say, “In my view the core purpose of government is to raise the livelihood of the people.” and says, “The PAP won the mandate to govern because it delivered jobs and housing”, pointing out that the PAP has “won every one of the seven general elections since independence in 1965.” Can’t argue with these points.

“There are two competing strands in our body politic.”

“ The first strand is meritocracy. It is modelled on the Chinese imperial scholar system where the best minds compete in nationwide examinations presided over by the emperor himself. The Singapore President Scholar is akin to the Chinese Imperial Scholar.

‘Both systems aim at identifying the best talent to serve the country.” What he missed out is that the Chinese intellectuals and activists (admittedly they usually had some form of Western education often via Christian missionaries) who wanted to reform and modernise the Chinese system in the late 19th and early 20th century criticised the imperial examination system for producing people who were only good in memorising the set examination texts (Classics like the Analects of Confucius). These “modernisers” argued that rule by these scholars under the Manchus led to the decline of China as a military, economic and scientific superpower, repeatedly being bullied and humiliated by the Western powers and Japan. The facts seem to support this analysis.

If the Chinese system was meritocracy at work, give me something else, please. Enlightened nepotism or Plato’s philosopher king, anyone?

Also selection by examinations should not be the only criteria of identifying “the best talent to serve the country”. What abt execution of duties? Or courage or integrity? Or manners? Or even sexual restraint?

“The second strand relates to the system of selecting leaders. It is modelled on Plato’s Republic [where] peers select their own leaders until the philosopher king emerges. As the first among equals, he is accountable to no one but himself. Over time, peer selection breeds a leadership that becomes complacent. Though our state is rooted in meritocracy, we must beware of the dead hand of peer selection. Elitism creeps in imperceptibly.”

He gave an example,“The recommendation by the ministerial salaries review committee to peg ministerial salaries to the median income of the top 1,000 income earners reflects an elitist mindset which is troubling. If the primary purpose of government is to raise the livelihood of the people, a better statistical measure of livelihood would be the median income of all workers, not just the top 1,000 income earners or the MX9 salary scale of the Civil Service.”

He pointed out the WP shares this elitism, “Curiously, both the government and the Workers Party accept that ministerial salaries be pegged to high income earners rather than the median of the work force, which is [US]$3,070 a month as at June 2011.” (WP is close clone of the PAP?)

He said that bonuses for the Cabinet should be pegged to increases in the median income of the work force, rather than the GDP.

Social divide

Much later in the speech, after talking about the economic situation here (covered in Part I), he returned to the theme of the social divide caused by the “widening income gap”.

“In 2012, what will be the threat to social stability? …Future social unrest will arise not from racial or religious differences [He had reminded that even though from its founding 1819 to when Singapore was granted self-government in 1959), S’pore’s races lived lives of passive co-existence, S’poreans witnessed the three racial riots in the 1950s-60s] but from the growing class divide caused by widening income gaps.”

‘The top 1,000 earn million-dollar annual salaries while the rest a monthly median income of US$3,070. The gap is untenable. In the past, equal opportunities in education have provided the social mobility to enable the bright boy from a poor family to make good … The spread of private tuition has changed the [level] educational playingfield.”

He said that during his school days in the 1950s (and mine too in the early 1970s), “only the academically weak students of rich parents take remedial tuition … Today, any parent who can afford the fees will send their children not for remedial but enhancement classes to give their children a head-start”.

This means that, “Though there will still be the exceptional individual who triumphs against all odds, more and more of our state scholars will come from upper, middle income families with professional parents.”

“There is no easy answer to the problem of an uneven playing field in our schools.”

His solution? “The challenge is to level up, not to level down. One suggestion I have is to make classes for academically weaker children smaller. The student-teacher ratio should be more favourable than in brighter classes so that the teacher can give more personal attention to each student, which is what private tuition is all about.”

He acknowledged that the government is doing something about the income gap, “The 2012 budget is politically adroit, replete with spending proposals which basically are income transfers from the taxpayer to the poorly paid, the disadvantaged and the aged.” But there is a hint of criticism, “Income transfers are palliatives, temporary reliefs to abate rising social discontent.”

Fostering entrepreneurs

He said that spending money to expand the then industrial training centres fostered entrepreneurs,

“[O]ur ITC [Industrial Training Centres, the precursor of today’s Institutes of Technical Education] trainees with barely O levels went on to start their own factories producing parts and components for MNCs.” (Bit of an exaggeration this. These entrepreneurs included teachers who were recruited to be managers, then moving on. In the 1960s and 1970s, MNCs recruited teachers because the workers were young and inexperienced, and teachers were experienced supervisors of the young. But the teacher-managers who moved on were often the non-graduates.)

Higher education not compatible with entrepreneurship

“It is hard to find the university graduate who becomes a successful entrepreneur. The prevailing reward system drives our graduates to become bureaucrats/managers both in government and business. White collar jobs pay better than blue collar jobs”

Overeducating

I’ll end with this remark, “[W]hy our concentration on engineering and science-based education is not yielding dividends in productivity and innovation. Instead, the employment share of low-wage, low-skilled personal services is rising. Are we overeducating our children? This is a heretical thought contrary to all my basic EDB instincts. In EDB, our article of faith is that the higher the education level, the more rewarding will our jobs become.”

He tried to answer this issue when he talked of S’pore’s reliance on “low-wage, low-skilled foreign labour to drive economic growth” and why S’pore should be“raising total factor productivity” a priority. I covered these in Part I.

————–

*Ngiam was in the 1980s one of Lee Kuan Yew’s and Goh Keng Swee’s most trusted civil servants and if anyone, could be called a co-driver of S’pore’s drive from third world to first world, it would be he.

Given that Professor Lim Chong Yah’s “shock therapy” proposal is a variation of what was implemented the early 1980s (until the 1985 recession: neutral article on the recession and one blaming it on the original “shock therapy”), when one Ngiam Tong Dow* was Permanent Secretary in the Ministry of Trade and Industry, I thought it would be interesting to reread a speech Ngiam made in March because MTI had once upon a time analysed the problem of severe manpower shortages and the economy’s increasing reliance on lowly paid foreign workers. Its solution was to restructure the economy by raising wages substantially to dampen employers’ demand for lowly paid workers, what Professor Lim is recommending.)

Rereading Ngiam’s speech, I don’t think he would agree with Dr Lim’s proposal because Ngiam says, “Rising productivity enables workers to be paid more. Inflation sets in only when wages are raised without any increase in productivity.” So productivity comes first, then wages rise as a consequence. Dr Lim would go back to the 1980s plan of raising wages to force up productivity.

(BTW, the government, especially Tharman, keeps “talking the talk” of raising productivity, despite not walking the walk. I’m sceptical of its announced plans to cut the “FTs are betterest” policy until I see how it is being implemented.)

The speech is long and can be divided into an economic analysis of S’pore and a sociopolitical analysis of S’pore,

In this post (Part I), I report and comment on the economic part of the speech**. In Part II (later this week), I will report and comment on the sociopolitical aspects of his speech.

——————————————–

Evolution of the policy of importing cheap foreign labour

“Singaporeans of my generation remember vividly the slums, joblessness, dirt and disease of the 1950s. Through dint of hard work and discipline, we moved rapidly from a labour to a skill-intensive economy. By the early 1970s, we achieved full employment with an unemployment rate of 3 per cent.

‘In the early 1970s when we achieved full employment, some of us in the EDB began to ask the question about the critical size of populations. We did some desktop research and found that there were several industrialised European countries with population size of around 5-6 million. These were Israel, Norway, Sweden and Finland. Our town planners went to work and concluded that Singapore with a land area of 670 square kilometres can comfortably accommodate a population of 5-6 million … we allowed in one million foreigners in the last decade.”

He went on, to give another reason for the FT policy, “As our births fell below replacement levels, we resorted to immigration as an instrument to top up the babies that young Singaporean couples are not having. There are also elements of political re-engineering. Submerged in our immigration policies is the belief that to maintain racial harmony, we need to keep the current population balance constant.”

He challenged the premise that S’pore needs a bigger population pointing out that

– “Singapore is already straining at the seams with a current resident population of five million … The economic assumption is that we can increase our GDP if we can accommodate more people … even doubling our population to 10 million people will not make things better. More likely, a larger population can only make matters worse.”

– “[C]omputer technology has made many manual operations in production obsolete. The key is to produce more with less manpower.”

Knowledge-based economy

“The great challenge … is that we have reached the limits of our skill-based model of growth. Singapore has to move from a skill to a knowledge-based economy. The products and services … are characterised by high technological content. To position ourselves for such an economy, Singapore devotes the greater part of our national budget to education and training.”

“When I was in school in the 1950s, only three out my O level class of 40 went on to university. Today, 30 per cent of a primary school cohort enrol in tertiary education. Raising our average educational level from primary to post-secondary should make a world of difference for our international competitiveness.”

“Our higher education levels and superior infrastructure enable us to compete in knowledge-based industries and services.”

Productivity

“I observe with some dismay that the manufacturing share of our GDP dropped from a high of 30 per cent in the 1980s to 20 per cent currently.”

“Our total factor productivity should be rising not stagnating. In my view, productivity and real wages of the bottom 20 per cent of our work force have not risen because our labour policies allow employers easy access to low wage foreign labour.”

He explains that for S’pore as a whole, there are costs to this easy access to cheap foreign labour, “If we add the cost of housing, transportation, health and other social services which employers have to provide for their foreign work force, they may be better off training and equipping their Singaporean employees to raise their productivity. Rising productivity enables workers to be paid more. Inflation sets in only when wages are raised without any increase in productivity.”

“Productivity can only be raised when CEOs … take direct charge of the production process. They have to be hands on, not resorting to outsourcing. Productivity should be the key KPI (key performance indicator) for the award of bonuses to CEOs and management.”

“Like any other country in the world, Singapore now competes in a global economy. In such an economy, importing cheap foreign labour is no longer a viable strategy. It is a dead end.”

“We have to grow through raising productivity, not higher headcount. We need to be smart enough to produce more with less. Our higher education levels and superior infrastructure enable us to compete in knowledge-based industries and services. We transformed ourselves in the 1970s from a labour to a skill-intensive economy.”

But he accepted that “raising total factor productivity .. is not easy. A Japanese scholar pointed out … that the optimum rate of productivity increase achieved by [Japan] averaged 4 per cent annually … Japanese are one of the most diligent people in the world.”

Why importing cheap labour is not the solution – it’s a race to the bottom

“Singapore now competes in a global economy. In such an economy, importing cheap foreign labour is no longer a viable strategy. It is a dead end.”

“In a global economy, you will be competing not only with friends and classmates but with the best and brightest of your generation in India, China, Brazil, Russia and Eastern Europe. University graduates in China and India are willing to work for a tenth of what our young engineers and scientists expect. If we fail to raise our total factor productivity, Singapore would just be an also-ran in the race to be a knowledge-based economy. The window to raise total factor productivity through application of knowledge and training is fast closing with the opening up of India, China and Indonesia. Singapore has lost two decades relying on low-wage, low-skilled foreign labour to drive economic growth.”

What can help

– “Our managers and administrators are among the best paid in the world. They will have to get off their high horse and personally lead the drive for higher productivity. Outsourcing is a bad word in my vocabulary. Companies and government ministries should figure out how to train their staff and redesign jobs and processes to achieve more with less.”

– “[I]nterest free loans should be given to enterprises with clear roadmaps to re-equip and raise the productivity of their workers.

What he is against

“Grants should not be given to management (consultants) to do a job they are already paid to do.”

‘I am against job credits in any form because they are simply wage subsidies which do not raise productivity in any way. My personal observation is that job credits simply add to the bottom line for payment of bonuses to management who do not have to lift a finger to raise the productivity of their enterprises.” Based on this, I suspect he would also be against having a minimum-wage.

“The 2012 budget is politically adroit, replete with spending proposals which basically are income transfers from the taxpayer to the poorly paid, the disadvantaged and the aged. Income transfers are palliatives, temporary reliefs to abate rising social discontent. They do not help to raise productivity.”

Final warning

“We failed to bite the bullet in the 1980s to restructure our economy. There may be no second chance the next time around.”

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*Ngiam was in the 1980s one of Lee Kuan Yew’s and Goh Keng Swee’s most trusted civil servants and if anyone, could be called a co-driver of S’pore’s drive from third world to first world, it would be he.

(Or “Mixed thoughts about the poor having to take out a HDB mortgage” or “What the HELL? PAP misses the plot!”)

In, I suppose, an attempt to show that ministers were not talking rubbish about someone earning less than a $1000 being able to afford a HDB flat (thanks be to a government subsidy, and forced savings via the CPF system), the constructive, nation-building ST had an article on how Mohammad Charlie Jasni who is earning $850 a month is able to afford a two-room HDB flat.

The analytical, compassionate, risk-adverse part of me agreed

– With the view articulated by TOC’s Uncle Leong that it would be better if Mohammad was allowed to lease, and not have pay a mortgage ($44 versus $83 a month)

— It’s cheaper.

— There is a possibility of him defaulting and losing all that he and his his wife have put in ($40,000 in CPF savings), “the probability of job loss, pay cut, sickness or accident, may be relatively higher than others … the likelihood of him defaulting on his mortgage over the next 30 years may be high”.

— He and his wife would have some savings for the couple’s old age. He is only able to pay only $83 a month because his and his wif’e’s CPF savings of $40,000 have been used up, reducing the amount owed to slightly more than $20,000.

– And with this comment on this TOC article thread, “I find it very CHILDISH for the government to glamorise a policy that enables a low income earner to own a HDB flat, and yet ignoring the fact that the same low income earner will face the bigger problems of making ends meet on the daily basic necessities like food and transport.

‘These low income earns may own a HDB flat but cannot survive paying the basic expenses in our daily life, and then end up dying of hunger… good policy meh? …”

On the other hand, the analytical, risk-taking side of me thinks that here is a couple who because of the CPF grant and forced savings have been given the chance to better themselves.

The couple can sell off the property after five years and make a good profit (at least $100,000) on the flat, even assuming a slightly weaker market. They can move to Johor, rent a place there, and he can commute. Alternatively in five years time, assuming he is allowed to rent the place out, he can use the rent money to rent a place in Johor, and commute. He could even go into business, while living in Johor.

The couple has options that leasing does not give them, albeit at greater risk. Many of the comments I read on this issue on the internet portray people like Mr Mohammad Charlie Jasni as passive and helpless. The one good thing the ST article shows is that this is not true. They are just as keen to better themselves as better-off, more fortunate S’poreans. In its Alice-in-wonderland way, the government is trying to help them out of a surreal place that is largely the creation of the government.

The issue is why is public housing so expensive: a two-room flat costs $99,200?, Note after $40,000 grant, the HDB loan is $59,220. On a 30-year mortgage at the HDB Concessionary Loan rate of 2.6%, the monthly repayment is $237. Mohammad is only able to pay $83 a month because the mortgage was reduced to slightly more than $20,000 because he and his wife have used up their CPF monies of $40,000. If they default …

But let’s celebrate Mr and Mrs Mohammad Charlie Jasni. They give the lie to the Hard Truth that only immigrants work harder and aspire to have a better life. They also give the lie to the casual assumption of many do-gooders that the poor are passive and helpless.

Ah, what about the German SMEs? Well the Germans are different. They stated two world wars in the 20th century, lost both of them but 67 years after failing to create a Third Reich is now the dominant European power; restructured their economy when Eurozone interest rates were too high for Germany (they cut real wages and welfare payments, and raised productivity, unlike the lazy, lying, thieving Greeks who only know to riot, lie and steal); and sell to China the machinery to make goods that China exports.

S’poreans are not Germans. For starters, the German government, like the Germans, doesn’t believe in FTs to solve Germany’s vanishing workforce problem: 20% over the coming decades. The Germans believe in robots and moving manufacturing to eastern Europe (their M’sias and Indonesias).

Also unlike our SMEs, the most succesful German SMEs are global leaders in their very specialised fields. Finally most of our SMEs would not fit the German definition of SMEs. Ours would be classified as micro enterprises

“The bequest goes to your loved ones, not to other CPF members and not to the Government. You get all of your capital back either through your monthly payouts or in a bequest that you leave to your family and loved ones.”

Err you don’t. What about the “premium”* that one pays to ensure that one is covered for life? This is “lost” if one dies too early to benefit fully from the annuity. The “premium” amounts to 10% of the amount in the Retirement Account (at age 55) for the Basic Plan and 30% for the old Balanced Plan. Both are not “peanuts”.

BTW1, I was not one of those who criticised or raised an eyebrow at Tharman’s remark that one could earn only $1,000 a month and still buy a HDB flat.

BTW2, I know that Tin Pei Ling is not helping to create sound-bites for Tharman, juz as she isn’t helping Vikram Nair with his jokes, Hri Kumar Nair with his research and MoE with gathering data on FT government scholars. She is focusing on helping the uncles and aunties in her self-styled SMC. By all accounts, she is doing a good job.

——-

*”Premium” is the amount that a CPF holder has to pay from his minimum sum in order to get life-long “assurance” of an annuity till death.I put the word “assurance” within quotation marks because technically if the CPF Plan that one is in goes bust, one’s annuity payments ceases. Taz the law.

Many bloggers are upset that the govmin is giving S$1.1bn to SMRT and ComfortDelgro to help improve bus services. Seems to them, “subsidy” is a dirty word. Hmm, didn’t they get the idea that subsidies are always bad from the PAP idea, particularly one LKY?

But maybe, the PAP has changed its mind that the word “subsidy” is a dirty word. Reminds me of what Keynes is supposed to have said In response to an accusation of inconsistency: Keynes is often reported to have said “When the facts change, I change my mind — what do you do, sir?”. More to the point, he is reputed to have said: “When circumstances change I change my mind. What do you do?”

Well the facts and circumstances have changed. The PAP’s share of the popular vote is only 60% and its perceived presedential candudate won by just 7000 votes or less than 1%.

I’m not complaining that the PAP is being pragmatic by addressing the hot issue of overcrowded public transport: I take the bus. I’m not one of those who don’t take the bus regularly, has one car per family member, doesn’t pay income tax, and bitches abt this subsidy.

BTW, I don’t own shares in either company, nor in SBS Transit. I never bot as I tot dividends might not be sustainable. Juz look at the share prices in recent years. The yield remains highish because share prices have collapsed i.e. dividend payments have fallen.

But now the 2011 dividend payments for ComfortDelgro and SBS Transist look sustainable.

Anyway, here’s an example of a subsidy. I own shares in HSBC which I’m glad took advantage of the European crisis to get a subsidy from the European Central Bank. Let the BBC’s Robert Preston tell the story,

“HSBC, widely perceived to be the strongest of the UK’s banks and one of the strongest in the world, borrowed €5.6bn from the ECB … The reason it may be controversial that British banks have borrowed so much from the ECB – a bit less than 4% of all the money on offer – is that the interest rate is so low, just 1%. So arguably eurozone taxpayers are subsidising UK financial institutions.

“Singapore labour force to start shrinking: DPM Teo” was the healine in Friday’s Today. The next decade will see the Singaporean workforce start shrinking, while more go into retirement, such that come 2030, there will be only six citizens starting their working lives for every 10 going into retirement. And beyond that, the Republic’s population will start to “decline sharply”. Article

The chart here shows that the following nations are all set to see declines of more than 10% in the expected change in working age population between 2010 and 2035. ; Switzerland, the Netherlands, Austria, Hungary, Italy, Portugal, Poland, South Korea, Russia, Japan and Germany. In the last two cases, the decline is set to be 20%. Despite the comments of one LKY, the Japanese are happy and properous, happily ignoring his advice on demographics.

Well I don’t see waz wrong being in the company of Switzerland, the Netherlands, Austria, South Korea, Japan and Germany. S’pore’s decline is much less than 10%, and it has the company of HK, Thailand, Denmark, Finland and China.

But maybe the government is worried about Indonesia, Malaysia and the Philippines? Don’t want them to be more successful than S’pore?

Whatever it is, maybe it’s about a variation of the theme behind this poem by Bertold Brecht, a famous playwright and Marxist activist (he was even a Hollywood screenwriter in the golden years of Hollywood in the 1930s):

In January 2011, after the footie authorities disbanded the national team after a dismal showing in the 2010 Suzuki Cup, but kept the manager, and promised the start of a rejuvenation process, I wrote “Managing people, the S’pore way”.

Well under the same manager, but with different players, the Lions have lost all six games in the third round of the FIFA World Cup qualifiers.

So I republish what I wrote then. Let’s hope this time the footie authorities stop their Serbian tua kee and FT loving ways. Pigs would fly first methinks.

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Managing people, the S’pore way

In the English, Italian, German and Spanish footie leagues, if a team does badly, the manager gets the sack. The view is that the manager is responsible for managing the players to get them to perform at thier best.

In S’pore, the manager retains his job, the players get the sack, even if the manager has been around for almost a decade.

In Western democracies, the ruling party gets replaced if voters are unhappy.

In S’pore, the ruling party creates GRCS, then super-GRCs, all the time telling the voters they are daft and lazy. And, juz to make sure, imports voters. Reminds me of what Bertold Brecht, a famous playwright and Marxist activist wrote:

After the uprising of the 17th of June

The Secretary of the Writers Union

Had leaflets distributed …

Stating that the people

Had thrown away the confidence of the government

And could win it back only

By redoubled efforts. Would it not be easier

In that case for the government

To dissolve the people

And elect another?

He was writing about the East German government after its soldiers had shot some protesters.

At least here, the unhappy voters are not shot, juz ignored, and threatened with a military coup if there is a” freak election result”.

I think the government has “got it”, more or less, in the overall thrust of the Budget. More below. But I’m annoyed (and sad) that it still hasn’t “got it” when it comes to helping the poor. I like the theory behind the GST Voucher for the poor (it helps make the tax on consumption less regressive). But like Workfare (which I support in theory), it is flawed because the poor need money both now and in the future, but both Workfare and the GST Voucher focus on the future. I’ll leave it to TOC’s Leong Sze Hian to describe the problem.

“A new GST voucher will be given to help particularly lower-income and elderly Singaporeans, comprising three components – cash, Medisave top-up and U-Save.

‘So, you pay for your GST increase in cash, but you get the bulk of it back not in cash, but as Medisave top-ups which you can only use for medical purposes, and U-Save which helps you to pay for what has historically been generally increasing utility bills.”

A wicked, mean tot. Could one of the reasons for putting the money into CPF accounts rather than pay cash be to lessen the cost to the government? The real value of the cash in the CPF accounts are steadily and steathily eroded by inflation. With the Medisave account paying 4%, and the ordinary account 2.5%, and inflation at juz below 5%, could the government be hoping that inflation reduces its headline cost by the time the money is withdrawn? Even if inflation returns to the 2% range, the real cost to the government is reduced. As I said, a wicked, mean tot that would never occur to a PAP supporter or a journalist in our constructive, nation-building local media.

Following the removal of deadwood from the cabinet, and the building of more public apartments despite a forecasted economic slowdown, the government has moved to address, by way of more than words, four other “toxic” issues that make S’poreans angry: the sheer volume of FTs flooding the streets, the use of FTs to keep wages from rising, congested public transport and growing income disparity.

Now whether the measures announced in the Budget are sufficient to reverse the problems that these four issues have caused, I don’t know. I suspect not, and more has to be done. Nor can anyone be sure that this isn’t all Wayang.

But a step has been taken. Whether the step is small or big, only time will tell. Whether more steps will be taken, again only time will tell. But a step has been taken, and this should be acknowledged by those of us who are not aligned with any of the opposition parties, whose reason or justification for existence, is rightly, to oppose the government.

Those of us who who are not aligned with any of the opposition parties should not be professional critics of the government. Which reminds me, I found Lucky Tan’s “Threats of Defamation Lawsuits : Not a way to win over netizens….” amusing because maybe the PAP thinks that trying to make friends on the internet is a waste of time given its failure to make the internet a more PAP friendly place. If so, the likes of Zaqy and Baey could find their cushy S$15,000 monthy stipends history at the next general election.

And if it’s all Wayang, we will soon know, “You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time.” And come the next general election, the PAP will pay a heavy price.

— do not have ‘return on capital employed’ as their most important goal. Contribution to society is always a very important point.” This should be a lesson to the government, Temasek and its TLCs, and other GLCs who are obssesd with two variants of “return on capital” : “returns on investment or equity.

Did the S’pore government which claims that “too much democracy” (I’m summarising it’s view) is not conducive to decision-making for the long-term, see China as the next growth market in 1975? I doubt it. S.poreans had difficulty getting permission from the S’pore government to visit China.

In October 1975 – 37 years ago, when China was in the chaos of the Cultural Revolution – the Financial Times described German policy towards the country: “China could be the next growth market”.

Talk about long-term thinking. In ultra-unlikely circumstances – where Chairman Mao was excoriating capitalism and the new Chinese constitution talked of a “dictatorship of the proletariat” – German capitalists had identified the big new market: the People’s Republic of China.

“The West German approach is typical of the very long-range view that German industry has taken,” said the FT.

“At the heart of the approach lies the cultivation of a market, even if the short-term results are not over-encouraging.”

Or take this from Die Zeit in the same year: “The image which Germany is trying to project in the largest and most populous developing country in the world is not that of a major political power, but rather of the most important industrial country in the world, a country whose tool-making and mechanical engineering can compete successfully on the world market.”

And this should be a lesson to the govwernment, Temasek and its TLCs, and other GLCs, do not have ‘return on capital employed’ as their most important goal. Contribution to society is always a very important point.”

I invest in Reits for the yields and the brokers and local media have discovered Reits as a great defensive play. But SMEs claim that Reits have caused their rentals to escalate unreasonably. JTC has been asked to review its current policy of divesting industrial space to private entities (like its Ascendas).

Business Times – 02 Feb 2012

SMEs blame Reits for growing rental pains

JTC asked to review its current policy of divesting industrial space to private entities

By MINDY TAN

(SINGAPORE) Rising rentals for commercial and industrial space have emerged as a pressing issue for small and medium enterprises (SMEs), and the fingers are pointed squarely at the dominance of real estate investment trusts or Reits as landlords.

The Reits’ drive to enhance yields and returns for unit holders – which usually translates into rental hikes – have left many SME owners, who feel they have limited alternatives here, fuming.

It has also led to calls – including a recommendation by the newly formed SME Committee – for JTC Corp to review its current policy of divesting industrial space to private entities like Reits and return to its previous role of an industrial landlord, so that it can provide ready and affordable industrial space to SMEs.

‘Rentals and capital values of properties are going up, impacting business costs for SME owners and eating into their bottomline,’ said Lawrence Leow, chairman of the SME Committee.

(Update at 9.00am on 15 Frbruary 2011: Headline rewritten, and changes made in text. “kbs” pointed out (see comments) that I misread the 2001 figures. Apologies for being daft. Will try not to be daft again.)

In 2001, it was ranked 97th. The survey uses prices of goods and services such as food, transportation, housing, utilities, private schools and domestic help to calculate scores for each city, using New York as its base with a score of 100. To be fair, most S’poreans do not rent homes in prime districts or send their children to private schools.

And the strength of S$ in 2011 can distort figures. A kilo of bread would have cost US$2.86 in 2010, according to the Economist’s data, but last year cost US$3.19 – an 11% increase. But, 6% of this is due to weakening US$. In S$, the price of bread would have gone up 5%.

Still 88 places in 10 years being number 9 is not shumething to crow about because

If we look at the data for the last 10 years, for example, the income of Singapore citizens at the 20th percentile level, grew by only 25%, from $1,200 in 2001 to $1,500 in 2011 (excluding employer CPF contributions).

In real terms, I estimate the annualized growth to be about 0.2%.

This is a far cry from the 2.2% real annualized growth for the last five years (including employer CPF contributions).

“Tan Jee Say, an opposition politician, said such global accolades [“the top marks S’pore scores in global surveys on the ease of doing business and low corruption levels”] often had little bearing on the lives of Singaporeans, many of whom who have seen their incomes stagnate over the past decade” (article), reminded me of what the Sage (not Stag) of Hougang said in 1997 or 1998 during the Asian financial crisis.

Low Thia Khiang (then the sole WP MP) spoke of the “new poor” and was roundly condemned and attacked by PAP ministers and MPs, and the local media for using of this term.

Well he was right wasn’t he? “The new poor” S’porean is a growing species. Leong Sze Hian pointed out a few days ago that wages have stagnated for many S’poreans for the last ten years:

10 Years – hardly any increase?

If we look at the data for the last 10 years, for example, the income of Singapore citizens at the 20th percentile level, grew by only 25%, from $1,200 in 2001 to $1,500 in 2011 (excluding employer CPF contributions).

In real terms, I estimate the annualized growth to be about 0.2%.

This is a far cry from the 2.2% real annualized growth for the last five years (including employer CPF contributions).

And didn’t Low have foresight when he asked in the late 90s for help for the “new poor? Something that was again rubbished by government ministers, PAP MPs and the local media, but which is now the part of the PAP’s strategy for regaining lost ground in the next general election: Bread and perhaps Circuses. The government is even planning to strengthen the almost non-existent social safety net, something which was taboo in the past.

So while S’poreans are rightly upset with the silence of the WP (Low is the leader) and MP Yaw (a married man) over whether Yaw had an affair with another married WP member, let’s not go overboard in flaming the WP, even though Yaw’s demotion (OK resigning as Treasurer and leaving the party’s politburo) tells us everything.

Cut it some slack because Low got the issue of the “new poor” spot on all those many years ago, and because he (and Chiam) kept the flame of opposition alive in parliament and on the ground, when it was most unfashionable to be associated with the Opposition. Example: one TJS was quietly working away in fund management. Remember too, Low has played a big part (he became the party leader in 2001?) in the WP becoming the force it has become. And finally, he did nuture two next generation leaders Yee Jann Jong and Gerald Giam.

So while I think the WP is damaging itself by being more PAP than the PAP itself by refusing to comment on “rumours” about Yaw, let’s hope the damage done is not too great.

In case if anyone is wondering, the WP did not pay me for this “ad”.

A final mean, very mean, unrelated tot: “Is TJS speaking from experience when he talks of ‘incomes stagnate’?”. Declaration of interest: My income has collapsed in the last decade. And even then it was a fraction of what I was earning in the mid 90s. I was, and am, part of the “new poor”. But no need to cry for me. Being poor is relative as Grace Fu and friends should realise.

And anyway:

Let what will be, be.

Tis labor lost thus to all doors to crawl,Take thy good fortune, and thy bad withal;Know for a surety each must play his game,As from heaven’s dice-box fate’s dice chance to fall.

What the report does not tell us is that SIA’s (along with Qantas’ ) Airbus 380s use RR engines. RR only has a 9% share of the Western-made aircraft engine market share. This again shows that there are benefits to Singapore in SIA being owned by the state. Bang yr balls harder SDP, NSP, KennethJ and TJS.

When one Tan Kin Lian was attempting a political career (while pretending not to do so) and, later, a presidential bid, the one thing that irritated me no end was his constant call for “fairness”. And when asked to define it, he said it is common sense.

I wish this had been written then so that I could post it, to get my blood pressure down.

Excerpts:

fairness is, as Scott Adams, the creator of Dilbert, puts it, “a concept invented so dumb people could participate in arguments”.

To get a “fair shot” is to be offered the opportunity to participate fully and succeed within the country’s institutions … Conservatives who strenuously object to the idea that the American system should aim at “equality of outcomes” will sometimes affirm “equality of opportunity” as an alternative. But this is a mistake. To really equalise opportunity requires precisely the sort of intolerably constant, comprehensive, invasive redistribution conservatives rightly believe to be required for the equalisation of outcomes. If one is prepared to accept substantial inequalities in outcome, it follows that one is also prepared to accept substantial inequalities in opportunity.

Getting a fair shot doesn’t require equalising opportunity so much as ensuring that everyone has a good enough chance in life. The content of “good enough” is of course open to debate, but most Americans seem to agree that access to a good education is the greater part of a “good enough” and thus fair shot. Naturally, there is strong partisan disagreement over the kinds of education reform that will do right by young Americans. And there is also disagreement over elements of a “fair shot” beyond education. For example, many liberals believe workers don’t have a fair shot at achieving a decent level of economic security without robust collective-bargaining rights. And many conservatives believe that an overly-strong labour movement invites outsourcing by raising domestic costs, and thereby deprives American workers of a fair shot at employment. There may be some fact of the matter about which policies are most likely to benefit students or workers. But if one is more fair then the other, how would we know?

What is it to do one’s “fair share”? In small groups, it’s clear enough. If my friend and I are shoveling the front walk, my fair share of shoveling, and his, is about half. Often we adjust for differences in ability. If I am big and strong and my friend is small and frail, his fair share may be as much as he can manage. That won’t mean that the whole remainder is my fair share, though. If we’re going to get the walk shoveled, I may have to do a bit more than my fair share. These things get complicated quickly. That’s why the question of what it means for an American do his or her fair share, qua citizen, is completely baffling.

Are you doing your fair share? How would one know? Actually, I just made myself feel slightly guilty for not going to med school and joining Médecins Sans Frontières. But unless government can come up with a way of taxing the leisure of people who aren’t doing as much as they might for kith and country, I reckon I’ll just stick to part-time pro blogging and let all you 9-to-5 suckers finance the necessary road-building and foreigner-bombing.

tempts me to agree with Mr Adams when he argues that fairness is “purely subjective”. But I’ll resist the temptation. I don’t think judgments of fairness are entirely whimsical. It really is unfair to eat more than your share of the cake, or to do less than your share of the shoveling, or to get ahead by flouting reasonable rules to which others faithfully adhere.

So what contributed to the recent decoupling of Singapore and Hong Kong home prices?

The simple answer is mortgage rates.

Driven by strong loan growth and rising loan-to-deposit ratios, Hong Kong banks have raised their mortgage rate spreads since early this year [2011]. This has resulted in higher mortgage rates and reduced demand for residential properties, which in turn led to the slide in private home prices since September.

On the other hand, the Government’s property cooling efforts have so far been thwarted by very low mortgage rates. With base interest rates remaining near record lows and Singapore banks charging very low mortgage spreads, affordability remains high.

However, there is a risk that Singapore mortgage rates would rise next year from their current low levels. Like their Hong Kong peers, Singapore banks have also experienced strong loan growth over the past year, which in turn has pushed up their loan-to-deposit ratios – although it must be said that ratios in Singapore dollars are generally still low.

Moreover, with the debt crisis that is plaguing the European Union, there has been anecdotal evidence that some European banks are pulling back their credit lines in Singapore to help boost capital ratios as required by the EU debt plan. If these banks continue to deleverage, it could result in less competition in the lending market for Singapore banks, which may then feel comfortable enough to raise their lending spreads, including mortgage spreads.

In fact, during the 2008/2009 global financial crisis, local banks such as UOB and OCBC were able to increase their net interest margins as foreign banks reduced their lending activities in Singapore.

Thus, while the recent decoupling in Singapore and Hong Kong residential property prices may make for an interesting read, we do not expect it to last for long, especially with the latest round of cooling measures introduced in Singapore.

Should happen as this UBS analyst postulated in late Dec 2011. But if the government thinks property prices will tank, not juz fall a little, the local banks will “do the right thing” by home owners, but not investors. It has happened before. In the crisis in the mid 80s, when many home owners had negative equity, the banks “did the right thing” and did not ask for more equity. Home owners had gd reason to vote PAP.

(Or “Why the PAP could turn the tables in the next GE: if the Opposition remains complacent)

Although what the PAP is doing is observable to the Opposition parties and their fellow travellers on the Internet, they seem blind or indifferent to the PAP’s actions, or both, because of their assumptions and prejudices. Worse, the major Opposition parties are complacent, what with the problems at WP, NSP and SPP (More of this on Monday in a CNY Special — gossip I heard while feasting and gambling).

Two Sundays ago, (as part of his ang pow strategy?) PM promised that, despite the economy slowing down, the government would improve the education and public transport systems, and build more homes so that young couples can start their families. These remarks were made at a Lunar New Year event in his Teck Ghee constituency, part of the Ang Mo Kio GRC. He also officiated at the re-opening of a wet market and food centre where he said more of such markets will be built over the next few years, with the aim of keeping food prices affordable. Not long ago, such markets were being to a commercial company which promptly increased rentals. He said nothing then. And the HDB and Comrade Mah gave grumblers the finger.

Then last Saturday in his CNY message he said Having children is ultimately a personal decision for families to make, but Government will do its part to reduce the anxieties and burdens of parenthood. Baby Bonuses already help families with the costs of raising children. We are also doing more to help parents balance work and parent­hood, including extending maternity and childcare leave, and encouraging companies to offer flexible working arrangements for employees with children. We are committed to helping young couples obtain their first HDB flat as soon as possible. With government support, childcare has become more affordable, and childcare centres are expanding and providing many more places than before. The critical factor now is not more financial incentives, but creating the supportive social climate and attitudes that will encourage couples to have more children.

This presses so many “hot” buttons: freedom to choose to have babies, social environment, financial help in raising children and affordable housing for the young.

What with the building of more public flats (despite the slowndown, and possible recession, Comrade Mah must be rolling his eyes in disbelief) and now taking a serious attitude towards other issues that upset voters (transport, education and the rising cost of living and the cost of raising a family, social and monetary, it looks like the government and the PAP have learnt the lesson that “It’s the voters, stupid”.

In the past, we would be told to tighten our belts to survive the slowdown. But given the still high levels, by global standards, of ministerial pay, and Grace Fu’s bitching about her pay cut, it would not be politic to tell S’poreans to lower their expectations. Better to follow the Roman emperors who made sure the populace of Rome had plenty of bread and circuses (gladitorial games). And S’pore has the money, despite what the SDP and Goh Meng Seng say. Even SDP’s most famous ex-member says so. To TJS, S$60bn from the reserves is “small change”. So does Citi, an investment bank**.

Even as late as November, I wasn’t too sure if the PAP and government had learnt the lessom of the May and August elections. In November, newbie PAP acting junior minister (and ex army brigader) was leading raids on foreign workers quarters. Judging from his remarks on Facebook, I assumed he wanted to see if the quarters were fit for human habitation, not whether there were illegal FT workers.

I was thinking to myself, he had better focus on the latter, given that the PAP is perceived by many true blue S’poreans as the “Pro Alien Party” and that the PAP should learn from the HK experience.

The once popular pro-democracy Civic Party suffered a series of defeats in neighborhood council elections in October last year in HK, as pro-Beijing politicians successfully tapped anti-immigrant sentiment as well as public hostility toward environmental measures perceived as harming employment and increasing the government’s construction costs.

The Civic Party had been gaining ground in previous elections, but ran into trouble this year as lawyers who are prominent in the party took on social and environmental causes that were unpopular among many Hong Kong residents. The most divisive issue has been whether more than 200,000 household workers, mostly from the Philippines and Indonesia, can eventually become eligible for citizenship.

The government and governing PAP is focusing on issues that affect the lives of ordinary S’poreans, shumething the Opposition parties especially the SDP have done for a long time. I hope bleeding heart liberals (especially those writing on or reading blogs like TOC) understand why. There are no votes (and eyeballs) to be won in helping foreigners, convicted criminals and dolphins.

Charity begins at home. Or to put it more nicely, “Conserve compassion: S’poreans come first, second and last”.

Build more homes, improve education and public transport, and keep the cost-of-living from rising too fast; and we shall see that the following comment by Catherine Lim is nothing but liberal, anti-PAP, bourgeois, elitist wishful thinking, “”PAP fatigue” among Singaporeans that is a result of PAP’s lack of nurturing Singaporeans politically, and failing to provide the proper environment for political education and growth.”

And who will care then if ministers pay themselves millions of dollars. I mean even the WP’s “base’ ministerial salary is $852,500 versus the PAP’s $1.1m. Waz 25%? The voters know that if the WP becomes part of the government, they will take the difference and keep quiet. I mean I don’t hear the WP MPs offering to take S$11,000 each, and publicly donating the balance to a charity.

One way the PAP and government can go wrong is that the PAP and govmin don’t do “circuses”. They don’t know how to spend tax-payers’ monies entertaining voters.

The other way is that they love FTs too much, thereby negating the message they are trying to send S’poreans that “S’poreans matter”. We are always hearing that less FTs, less propsperity from the local MSM, quoting alll manner of ministers, officials and “experts”, usually from local universities (esp from SMU) and broking houeses. The latest is variation on the theme that FTs are good for S’pore: yesterday, ST reported an economist from Merrill Lynch, an investment bank, as saying, “Part of the reason for the sticky inflation is that policies such as the tightening of the inflow of foreign workers are keeping wage costs high. These are being passed onto the consumer.” Knowing the reputation of the economist in question, ST most probably left out the other factors he cited, focusing on FT shortage.

FT love also means that the measures to cut back FTs will be not be serious, and enforced lightly, annoying S’poreans.

So there is al to fight for. The PAP’s continued decline is not assured, neither is its revival.

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*In a report dated December 2011, Citi said meeting higher expenditure needs without running a fiscal deficit will not be a problem for Singapore’s government. While the fiscal surplus may shrink, its economist estimates that the government can draw on an additional $1-3 billion in net investment returns, without breaching the 50% cap on the amount of long-term expected real returns on reserves.

It was reported by CNA that DPM Teo Chee Hean (one of the better ministers in my view) “said the government’s focus is on ensuring that Singapore remains the best home for all Singaporeans.

‘Beyond developing an attractive living environment and a thriving economy which sustains good jobs for its citizens, Singapore also needs to strengthen the bonds that Singaporeans have with one another and with the country.”

My bitch is about “good jobs for its citizens”. If anything the government has attempted to “developing an attractive living environment and a thriving economy” by making it difficult for the wages of citizens to rise despite rising housing prices and cost of living expenses. It does this via its “FTs are most welcomed” policy, which keeps wage costs down. To be fair, the FT policy also helps keep property prices up. See next posting.

It is a fact that FT HR employees aggressively pitch to the employers, the merits of their compatriots. I know a manager in an MNC wanting to employ a S’pore-trained lawyer, being sent nothing but the CVs of Filipino-trained lawyers by his, you guessed it, Filipino FT HR manager.

Even though it has now promised to moderate this policy, it has not changed its views on the importance of this policy. Hence its constant ministerial refrain that less FTs means less GDP growth and less jobs for S’poreans. And the constructive, nation building media and academics from SMU keep on harping on the unhappiness of employers who want cheap FTs, and the costs to the economy (including less full time jobs for ploy grads).

The SDP, KennethJ, Lina Chiam and many regular contributors to TOC and TR are forever harping that standards of living for the majority of S’poreans have dropped since the 1990s. I take these comments with a large pinch of salt, even though I am an agnostic when it came to the claims of the PAP and government that living standards had improved throughout the noughties. (What am I supposed to think when the CEO of HDB tells me that shrinking flats means a higher standard of living for occupants? Yes I am misquoting but not that blatant leh.)

They would say that wouldn’t they?

Still I was surprised yesterday evening when catching up with the local propoganda sheets, I read, While Singapore has 900,000 HDB flats and 557,000 car park lots [or 619 for every 1000 flats by my calculations], Mr Khaw noted the problem of car park shortages was mostly felt in older HDB estates, which were built under old car park provision norms. In estates with four-room flats for example, 560 car park lots were planned for every 1,000 flats.

“This was adequate in the past but not any more. More Singaporeans now own cars and some own more than one car,” said Mr Khaw, who noted that 5 per cent of HDB households own two or more cars. The equivalent norm now is 710 car park lots for every 1,000 flats. With these new norms, Mr Khaw assured that new HDB flats would come with adequate car parks. Today on 24 December.

This means that despite rising public housing prices and COE prices, more HDB dwellers (remember over 80% of S’poreans live in HDB flats) are owning cars than ever before.

Of course, this could be another Khawism like his S$8 heart operation.

Assuming, Khaw was not fibbing about the numbers, will the SDP, KennethJ, Lina Chiam or the many regular contributors to TOC and TR Emeritus who are forever harping that standards of living for the majority of S’poreans have fallen, explain how come so many ordinary S’poreans are rich enough to own cars (some even two) despite rising COE and HDB prices?

Does this have anything to do with the easy availability of credit? And if so, is it good or bad for S’pore?

Maybe the 60% of voters who voted PAP are not deft? And one LKY is right to wonder why 40% of the voters are not gtrateful to him and the PAP.

(I waited eight days after the data on PRs owning HDB flats came out because I wanted to see if the local MSM would give a favourable- to the government- spin on the data, which the MSM could reasonably do. The MSM was silent.)

Last Tueday, BT reported that S’pore permanent residents (PRs) owned some 48,700 HDB flats as at September 2011 , according to the Ministry of National Development. It was answering a PAP MP’s question. According to this, there were approximately 1,038,473 flats as of May 201o.

This means that 4.7% of HDB flats are owned by PRs. So those lurid figures (over 20%, if I remember correctly) claimed by TR are not true.

It was also reported that 39,100 units in the 3rd Quarter 2011, are rented out. Assuming that the rentees are all FTs (PRs and other foreigners), a not unfair assumption, this means only 8.5% of the flats are occupied by FTs. Again, nothing near what TR claimed (over 30% from memory).

Now as PRs are 13.9% of the resident population or 10.2% of the total population*, and PRs and other FTs 37.1% of the total population, these HDB numbers indicate that PRs and other FTs cannot be a major cause of HDB price rises. If the 8.5% of the flats are occupied by FTs were 30- 40% (in line with their share of the population), then they would be a major cause of price rises. So Mah was right to he said that PRs and other FTs had no or little effect on public housing prices?

The way to look at this piece of data in relation to all the data made available is that FTs have an effect (disproportionate perhaps?) because the supply was not keeping pace with demand given the influx of FTs. Khaw’s programme of building a surplus buffer is an admission that there was insufficient supply when the FTs were flooding in, courtesy of the government that we voted in in 2006.

No surprise then that the government and PAP spin doctors, and ST and MediaCorp staff missed telling us shumething important. This piece of info shows that Minister Mah did not know the numbers, or was fibbing when he said that PRs and FTs had no or little effect on public housing prices. They had an effect because he goofed, and then was in denial. Hence the silence when the local MSM or spin doctors could have rubbished TR’s assertions, and the belief that FTs are the the major cause for HDB price rises?

This piece of information helps give some perspective to the ongoing (often heated and irrational on both sides) debate on public housing and immigration. Yet it only appeared in BT, which is behind a pay wall most of the day. Later Yahoo! reported it. This reminds me of what David Boey in a letter to Voices wrote, ” [R]elevant information is sometimes unavailable to the public or is not presented in a consistent format to facilitate analysis.”

How true and sad. Can fix this lack of info or not, PM? Will be a test of your promise of more openness, and change.

————-

*”Singapore’s total population stood at 5.18 million as at end-June 2011. There were 3.79 million Singapore residents, comprising 3.26 million Singapore citizens and 0.53 million permanent residents, and 1.39 million non-resident foreigners, ” Department of Statistics report released on September 28th 2011.

“Singapore’s total population stood at 5.18 million as at end-June 2011. There were 3.79 million Singapore residents, comprising 3.26 million Singapore citizens and 0.53 million permanent residents, and 1.39 million non-resident foreigners.”

(This piece is a continuation of https://atans1.wordpress.com/2011/11/22/why-moving-ministers-around-or-out-is-gd-for-everyone/ Let me be clear: My analysis of the u/m minister’s performance is based on publicly available data. I am drawing reasonable inferences by connecting the dots. Nothing personal against the minister. In fact, the minister is a better example than Tan Jee Say, of a poor boy made gd under the system in place in the 70s and 80s. BTW, he and TJS were both born in 1954 and were in RI. )

There is still one cabinet minister who underperformed twice, possibly thrice and who is still in the cabinet.

Lim Hng Kiang was HDB minister from 1994 to 1999, and has to take part of the blame that there was oversupply in the early noughties, something that Mah is blamed for. Mah took the lesson to heart and proceeded to build too few flats resulting in a world first: public housing prices rising in a recession.

He then became Health minister and told us complacently that we had to accept that people had to die in the SARS epidemic. Rumour is that one LKY did not buy into this when his wife fell ill and it was feared she might have contracted SARS. In August 2003 (after the worst of the epidemic had passed), Khaw became health minister and started reforming the public health system.

Lim Hng Kiang has been the Trade & Industry minister since 2004. S’pore is once again facing an economic slowdown , the second in three years because two of our main drivers of growth are not diversified. The exports of pills and electronics tend to move in the same direction.

Is the failure to develop new and diversified drivers of growth partly his fault? We had a recession in 2008- 2009 and a looming slowdown today because the main drivers were correlated. Whatever happened to the plans articulated by then DPM Lee Hsien Loong in the early noughties to have less correlated drivers of growth?

As he has been in the ministry for about seven years, how come we are seeing no changes in the drivers of growth?

And remember the wikileak cable from the US embassy here, “The MPs, who were all members of the ruling People’s Action Party (PAP), indicated that Island could not rely on MTI (and EMA) to stand up to Temasek because MTI Minister LIM Hng Kiang is “weak” and not part of the PAP “inner circle,” Reading claimed.”

So why is he still in the cabinet? PM should follow his dad’s policy of ruthless execution of underperformers, not his successor’s and his (pre May 2011) tolerance of underperformers. His dad must be aware of what Bertolt Brecht, the famous Marxist and German playwright, meant when he wrote, “The finest plans have always been spoiled by the littleness of them that should carry them out. Even emperors can’t do it all by themselves.”

If you are reading this M John, please realise that the best RI boys are not necessarily those with high academic credentials like yrself, Goh Chok Tong, Hng Kiang, Raymond Lim or Tan Jee Say, who then become highly paid ministers like Goh and the Lims. Think rather of self-made billionaires like Peter Lim and A Hussain. One juz has an ordinary degree and the other never went to university. They are the people who do RI proud, not the scholars turned civil servants/ soldiers turned ministers who one can reasonably (but nastily) argue are effectively on state welfare from age 18 until they die.

When I read on Wednesday that Singapore is improving the International Cruise Terminal with the aim of seeing the number of berths double by the second quarter of next year, it reminded me of the constant planning and work that goes into upgrading S’pore’s links with the rest of the world, which I contrasted with the reasons (excuses?) given for the overcrowding on our trains, which according to a media report on Sunday would take up to 2018 to resolve, and which led to the usual howls from netizens that there was bad planning by a government that didn’t care about commuters comfort.

I remembered a few years ago analysing how forward looking was S’pore when it came to developing the airport. S’pore was always planning to grow the airport so that it would never get congested. This was unlike Thailand. A few months after the new airport was finally open a few years back after failing to be completed on time, the new airport was working beyond its planned maximum capacity, resulting in congestion and delays.

I remembered remarking in a report that this could never happen here. S’pore was always expanding capacity, knowing that it took time to build infrastructure. It never wanted the airport to look like a congested, overcrowded slum. It gave a bad impression to visitors.

Likewise the port. It is always expanding capacity and erring its projections on the side of overcapacity rather than congestion. And it’s doing the same for the cruise terminal. Singapore is investing heavily in cruise infrastructure to ensure the industry becomes a driver of growth for the tourism sector.

If the government errs, it errs on the side of overcapacity, not undercapacity. It feels that the demand would be there, and even if it didn’t materialise as planned, the spare capacity would attract demand.Contrast this spending with what happened in public housing and trensport. In this Donald Low explains why the government became wary of building more public train lines and public housing. It all has to do with projections that went wrong in the 1990s.

The contrast in the spending patterns seem to show that comfort and well-being of S’poreans are not as important to the government as securing the engines of economic growth? In the name of latter, building to meet possible demand seems to be in order, but not when it comes to the former? Why not?

Note that the plans for development of the rail, sea and air transport links are made within the transport ministry, whose spending plans are scruternised by the finance ministry. Yet the approach seems different between domestic and international links.

So, we the people, are going to get more help from the government; and in particular the Health Ministry will do more to help those suffering from chronic illnesses. My friend who suffers from a chronic illness will be hoping the government walks the talk.

He tells me that the cost of buying “unsubsidised” medicine in Johor Bahru is more or less the same as the same “subsidised” medicine bought from SingHealth via a polyclinic. As the price of the medicine bought from SingHealth is roughly half that charged by a private clinic here, he thinks that is why the govmin claims it is “subsidising” the medicine bought from SingHealth.

He thinks maybe the government’s medicine procurement policies are inefficient. How come a profit-making M’sian pharmist chain can match SingHealth’s prices? Or maybe that the government is paying the drug makers more so that they will make pills here and invest in R&D facilities here.

In other words, are polyclinic patients subsidising rich MNCs so that the government can boast of its success in attracting drug companies to set up pill-making plants and R&D facilities here? Their presence here, incidentally, boosts GDP growth and, indirectly, the bonuses of ministers and senior civil servants.

S’poreans have long asked where’s the subsidy in public housing? The government ties itself in knots, trying to explain where is the subsidy. So much so that many S’poreans don’t believe that there is such a subsidy.

So here’s another “subsidy” that should be queried by the public.

On a wider point, ordinary S’poreans should join the Opposition and activists in querying how the government defines any “subsidy”. We are unlikely to get straight answers, but the questioning ensures that they know that we are not daft.

Singapore is one of the few remaining AAA sovereign borrowers, especially one without any fiscal issues.

So money will pour in, interest rates will drop, and property prices will fly.

The banking system may soon have more cash deposits than it knows what to do with. In the 1970s in Switzerland, banks were paid to accept deposits i.e. negative interest rates.

This is a tough problem to solve. If our central allows the exchange rate appreciate in order to slow the inflow, a more expensive Singapore dollar will hurt exports and tourism. If it doesn’t act, then Singapore will face significant inflationary pressures. House prices will fly even higher, SBS, SMRT and the electricity suppliers will fleece us even more, and CPF rates will drop to 0.1%, if not negative. We will pay the government interest on our forced savings. OK I exaggerate on the likihood of this.

Even the late Dr Goh Keng Swee might not have been able to solve this problem.